Tax Research UK

Prem Sikka has an article on Richard Branson’s bid for Northern Rock on the Guardian blog today under the above title.

Prem notes that:

Sir Richard has said Virgin will only pay itself ‘normal’ dividends from Northern Rock until public money has been repaid.

And asks:

What does this mean?

Because, as Prem notes:

There are in fact plenty of other ways Virgin could get a return.

I’ve already explored some of these here, and Prem adds to the comments I make in his own unique way before saying:

The question for the taxpayers, politicians, depositors, investors and creditors is whether they are comfortable with the fact that a major bank and mortgage provider would be controlled by a secretive offshore entity in BVI.

The sub-prime crisis shows that the accounts published by banks are opaque and generally lack transparency. The proposed sale to Virgin will further exacerbate the problems. It is time the government explained the assurances on transparency and public accountability that it has secured. As a matter of principle, no entity located in a secretive tax haven should be allowed to own a bank.

Absolutely right.