By Dipankar De Sarkar, IANS,
London : A new law to curb British party political funding by wealthy individuals who are registered as ‘non-domiciled’ for tax purposes will not be enforced immediately, Indian origin industrialist Swraj Paul said Sunday.
“The effective date of enforcement has to be decided,” Paul, chairman of the Caparo Group of industries and a major donor for Britain’s ruling Labour Party, told IANS.
Paul’s confirmation on the effective date followed media reports Sunday that said the law – passed July 20 – will not be enforced until after the next general election, due by June 3, 2010.
Immediate enforcement of the law would place a 7,500 pound cap on the amount of money that a Briton with non-domicile tax status – a so-called non-dom – can put into political parties.
Non-dom status allows Britons to save taxes on their earnings abroad.
All three of Britain’s main national parties – Labour, Conservatives and Liberal Democrats – have benefited from funding by wealthy non-doms, but Labour in particular counts on the support of a string of Indian origin non-doms.
Apart from Paul, Labour donors include Lakshmi Niwas Mittal, Britain’s wealthiest man and main owner of steelmaker ArcelorMittal, who has reportedly donated a million pounds, and Ghulam Noon, known as the Curry King for his Indian food empire.
Paul said he did not speak on the Bill in the House of Lords, of which he is deputy speaker, on a matter of principal as he has a vested interest in the issue.
“I follow the law – I don’t make the law,” said Paul, who has bankrolled Labour for more than 20 years but has never disclosed how much he donated to the party.
British newspapers reported Sunday that the new law would only be enacted after the next general election because ministers claim it is “too complex” to make immediate changes.
The decision angered MPs who have argued for change.
Lord Dale Campbell-Savours, a campaigning Labour member of the upper house of parliament, accused the government of “wriggling out” of its commitment.
“This is not in the spirit of the undertakings given to parliament. It seems that the law has somehow been circumvented.”
Lord Matthew Oakeshott, the Liberal Democrat treasury spokesman, said he suspected Labour was concerned that the party cannot fight the cash-rich Tories in a climate of recession.
The Ministry of Justice said: “We do not believe at present that it will be practicable, given the complexity of the provision, to commence before summer 2010, but we will keep that under review.”
A spokesman for the Electoral Commission said it was up to ministers when the new measure would be enforced, adding: “In the meantime, the rules will stay as before and someone who is non-domiciled can still donate.”