After yesterday’s Sunday Times article on Barclay’s alleged tax avoidance schemes to which I contributed there is ore today.

The Daily Telegraph has reported that:

Banks which are directly or indirectly reliant on Government support should be forced to stop using systematic tax avoidance schemes, Liberal Democrat Treasury spokesman Vince Cable said.

His call came as he sent documents to both the FSA and HM Revenue & Customs detailing how Barclays has allegedly been avoiding paying massive amounts of tax. The documents purportedly come from a whistleblower within Barclays investment banking arm, Barclays Capital.

Mr Cable said it was both "incongruous" and "offensive" that banks that rely on state support should avoid paying tax and therefore be "selling the taxpayer short". Although the taxpayer has not had to directly support Barclays by taking an equity stake, the bank has relied on the Government's special liquidity scheme to provide funding for loans

"The banks are able to organise their activities in such a way that they can run rings around the Inland Revenue," he said. "It serves no other purpose than to reduce tax. The fundamental point is that it is incongruous and offensive that banks which are either directly or indirectly dependent on the Government should be systematically finding ways to avoid tax."

As is commonplace, it is hard to argue with Vince on this one.

I have seen this documentation. I confirm that the arrangements are extraordinarily contrived. What is intriguing is that elements of the planning do not just require the arbitrage of international tax rules, they also require arbitrage of International Financial Reporting Standards against national accounting standards to allow recognition of transactions in different ways for different purposes.

I would stress I did not calculate the losses Barclays imposes on the UK as a result of this activity. The Sunday Times says it is £1 billion. As the Telegraph again notes:

Reports over the weekend suggested that Barclays makes £1bn a year through its tax avoidance schemes, an allegation that was vehemently denied by the bank.

"The claim we make £1bn out of tax avoidance is absolute nonsense," a spokesman said. "Barclays does not encourage or condone tax evasion. We comply with taxation laws in the UK and the other countries in which we operate."

Who said anything about tax evasion? The only thing that is being suggested here is tax avoidance. In that context, this rebuttal is nonsense.

And, let's consider the claim that Barclays does not make £1 billion from this activity. It is suggested that Roger Jenkins alone earns at least £40 million a year. He has a considerable team. They must cost £100 million to run. Who is going to take this activity with this level of cost without making a substantial profit? Barclays suggested the revenue from this activity might be £1 billion to the Sunday Times. So what if there are costs of £100 million to offset? That will be it for profit and loss account purposes. Barclays need to tell me what is so far wrong with the Sunday Times estimate in that case. The difference between £900 million and £1 billion is pretty immaterial in this context.

I have been chasing Roger Jenkins since 2006. I now know that a very great deal (materially all) of what I have said is correct. I know Barclays is an organisation that is morally corrupt to its very core.

Never before has there been a greater need for a general anti-avoidance principle in UK law. It is an issue to which I will return again soon.