Christian Aid has hit out at its former ‘tax superhero’ nominee, Katie Melua, after it emerged that she had participated in a tax avoidance scheme.
In 2008 the singer told an interviewer that she was happy to pay her fair share of tax and was subsequently nominated for Christian Aid's ‘tax superhero’ award in 2010. The award was won by Eva Joly, a European politician and activist.
Joseph Stead, senior economic justice adviser at Christian Aid, said: “The news is very disappointing. Christian Aid believes it’s morally wrong for people to avoid paying their fair share of tax, because it undermines vital public services such as hospitals and schools and forces up taxes on people who are too poor or too honest to use such schemes.”
He added: “To be frank, finding celebrities we could use as examples to endorse our tax campaign was an uphill struggle as we have no idea about the tax status of most. Katie, however, seemed ideal because of her public pronouncements on the subject.”
Melua was one of a number of celebrities named by The Times yesterday. She is reported to have tried to hide £850,000 from HMRC through a tax strategy known as Liberty, which created a tax loss for investors which they could offset against their own income without losing any money. The government closed the scheme in 2009.
According to the newspaper 1,600 people took part in the scheme including businessmen, lawyers, doctors and other celebrities. Around £1.2bn is estimated to have been invested in the scheme between 2005 and 2009.
A spokesman for Melua told The Times that she paid her paid her taxes in full.
“At the suggestion of her accountants at the time, Ms Melua participated in the Liberty tax planning venture back in 2008 and declared this to HMRC," he said. When HMRC stated they were reviewing the scheme, she paid the tax to HMRC in full. Accordingly, HMRC are not out of pocket and she has not avoided any tax liability."