Panama Papers: Cameron 'does not gain from offshore funds'

Downing Street has said David Cameron, his wife and children do not benefit from offshore funds after questions about his family's tax affairs.

No 10 was forced to issue a statement after Labour called for an inquiry into Britons linked to tax haven allegations - including Mr Cameron's family.

Labour leader Jeremy Corbyn had called on the PM to "set the record straight" and publish his tax returns.

The row centres on an investment fund set up by Mr Cameron's late father Ian.

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Leaked documents revealed Ian Cameron was a client of Panamanian law firm Mossack Fonseca and used one of the most secretive - albeit lawful - tools of the offshore trade after he helped set up a fund for investors.

'Private matter'

Downing Street said people accusing the PM should "put up or shut up", after facing a day of questions from the media about whether his family retains an interest in the fund, which was registered in the Bahamas to shield it from UK tax.

BBC assistant political editor Norman Smith said Downing Street had been trying all day to draw a line under the row and to "shield" Mr Cameron, issuing a series of statements setting out the government's actions on tax avoidance.

"You can almost sense the exasperation in Number 10" that Mr Corbyn had "managed to throw them on the defensive", he added.

The Labour leader said: "I think the prime minister, in his own interest, should tell us exactly what's been going on.

"It's a private matter in so far as it's a privately held interest, but it's not a private matter if tax has not been paid. So an investigation must take place, an independent investigation."

The Labour leader said he would publish his tax returns and called on the prime minister to do the same.

Asked whether the PM should resign if he is found to have benefited, Mr Corbyn said: "Let's take one thing at a time. We need openness, we need an examination, we need a decision after that."

He said an inquiry was needed by HM Revenue and Customs to quickly get to the bottom of how much private wealth was being "siphoned off" overseas, claiming the British taxpayer is being short-changed by the super-wealthy being allowed to "dodge taxes and flout the rules".

'I own no shares'

Asked about Mr Corbyn's comments after making a speech in Birmingham, Mr Cameron said he agreed that HM Revenue and Customs must investigate alleged abuses uncovered in the leaked Panama papers.

He added: "In terms of my own financial affairs, I own no shares.

"I have a salary as prime minister, and I have some savings which I get some interest from and I have a house which we used to live in which we now let out while we're living in Downing Street, and that's all I have."

He said no prime minister had "done more to make sure we crack down on tax evasion, on aggressive tax avoidance, on aggressive tax planning both here in the UK and internationally".

Ian Cameron was a director of Blairmore Holdings

He said the government had reclaimed billions of pounds and led the world in having an open register of beneficial owners of companies, which is due to come into force in June.

Downing Street then issued a statement, adding: "To be clear, the prime minister, his wife and their children do not benefit from any offshore funds.

"The prime minister owns no shares.

"As has been previously reported, Mrs Cameron owns a small number of shares connected to her father's land, which she declares on her tax return."

Labour MP Wes Streeting, a member of the Commons Treasury Select Committee, welcomed the "clarification" but said Mr Cameron must clarify whether he has previously benefited from any off-shore funds.

"I think where David Cameron made a rod for his own back yesterday was issuing quite a qualified statement that then led people to think 'is he being shady about this, is he being evasive, are there further questions to ask'."

"I think there are still questions about whether or not he benefited in the past," he told BBC Radio 4 Today.

The leaked documents show that Ian Cameron, who died in 2010, was one of five UK directors of Blairmore Holdings who flew to board meetings in the Bahamas or Switzerland. There were also three directors in Switzerland and three in the Bahamas.

'Ahead of the pack'

If the meetings had been held in London, then it may have been considered resident in the UK and taxed as a UK company.

The leaked documents also reveal how the company used bearer shares, ensuring the true owners - the wealthy investors in Blairmore Holdings - were kept hidden from view.

Blairmore stopped using bearer shares in 2006. It was David Cameron's government that banned bearer shares in the UK in 2015.

Mossack Fonseca registered more than 100,000 secret firms to the British Virgin Islands

Labour has called on the government to consider imposing "direct rule" on the British Virgin Islands - where Mossack Fonseca registered thousands of companies - and other British Overseas Territories if they do not comply with UK tax law.

Downing Street said it was close to reaching agreement with Crown Dependencies, such as Jersey and the Isle of Man, on ensuring details of who owns companies registered there are accessible to British police and other law enforcement agencies.

But it said British Virgin Islands and Cayman Islands had yet to get "over the line" in terms of "full and effective transparency" with regards to beneficial ownership information.

The British Virgin Islands government said it was "very concerned" at the reports, saying it had a "rigorous" regime that complied with international standards.

It promised a thorough investigation and to take further action where necessary.

The UK Overseas Territories Association said it remained "directly engaged" with Labour and hoped parties would continue to support territories' "self-governance and self-determination".

Eleven million leaked documents showed how Mossack Fonseca clients were able to launder money, dodge sanctions and avoid tax - the law firm says it has operated beyond reproach for 40 years.

There are links to 12 current or former heads of state in the data, including dictators accused of looting their own countries.

The Guardian has reported that a number of Conservative donors, supporters and former MPs are linked to tax havens around the world. A number of them have firmly denied any impropriety.

Reaction around the world to the Panama papers includes:

• Iceland's prime minister Sigmundur Gunnlaugsson has resigned over allegations he concealed investments in an offshore company - he denies any wrongdoing

• Close relatives of seven current or former Chinese leaders have been found to have links to offshore firms

• The Australian Tax Office (ATO) is investigating more than 800 individual taxpayers, all residents of Australia

• The US Department of Justice is reviewing the leaked documents to look for evidence of corruption that could be prosecuted in the US, the Wall Street Journal reports

• France and Spain are investigating money laundering exposed by the leaks among their resident taxpayers

• Panama President Juan Carlos Varela has said his government has "zero tolerance" for illicit financial activities and would co-operate vigorously with any judicial investigation in any country