Buried in Rishi Sunak’s autumn statement was an important clue to how the Tories see Britain’s post-Brexit future.
Yes, there were the dire predictions for the economy – GDP 11.3% less than expected just a year ago; the deficit at a huge £394 billion; the vote catching pledge to cut foreign aid; and the promise of ANOTHER public sector pay freeze.
But there was also a bizarre plan to create up to a dozen freeports.
Freeports? Each one can cover up to 1500 square kilometres and businesses will be able to relocate into them for Corporation Tax, VAT and National Insurance breaks.
The UK will have a low tariff regime anyway so the main argument for freeports, which is to enable tariff-free economic activity in and around the ports, disappears. All that will be left is a fertile territory for tax evasion and tax avoidance. In the same Autumn Statement he pledged £1 billion for Brexit IT systems for HMRC but only £20 million for tax enforcement even though research shows that £9 is recovered for each £1 spent.
Questions are multiplying abut Sunak’s own finances too. He made his money in the Theleme hedge fund which has just made $500 million on the Moderna vaccine and is based for tax purposes in the Cayman Islands. Although he quit Theleme in 2013 the extent of any holdings by him in the fund remains unknown. What is known is that he did appoint a Theleme partner onto the Covid task force which certainly would not harm Theleme’s chance of gaining and using inside knowledge on vaccine development.
So there we have it – the UK as a colder, wetter Cayman Islands where the hedge fund elite live a very separate life to the population at large.