Tax Break May Be Unfair - and a Price Worth Paying

Evening Standard - London › June 07, 2007

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Summary

SVG CHAIRMAN Nick Ferguson has never been one to shirk difficult questions, which is probably why the performance of SVG has been so good over the years. That said, he may have a twinge of regret at the storm which has broken following his remarks, quoted in the Financial Times, that he had yet to hear a credible explanation of why it was justifiable for a millionaire private-equity partner to pay less tax than a cleaning lady.

Most people would agree with the carefully crafted words he used it is hard to explain why the very rich should pay less tax than the very poor. The problem is that once the politicians, special- interest groups and media have picked over his words and chiselled them for their own ends, the chances are that his message will be significantly changed. It will be turned into a statement that the tax regime surrounding private equity is unfair and by implication that those trade union leaders andothers who are lobbying to have it changed have right on their side. This categorically was not what Ferguson said.

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Extract

Tax Break May Be Unfair - and a Price Worth Paying

It cannot be repeated too often that private equity gets no significant tax breaks that are not available to business and individuals in general. It is a fact that anyone holding a business asset will find that their liability to capi...

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