OFFICIALS from the Prince of Wales's estate have defended its tax arrangements as MPs demanded to know if they "reflect the reality of the world today".
The Prince receives an income from the Duchy of Cornwall – a record £19 million in the most recent set of accounts – but the body is not liable for corporation tax or capital gains tax. Appearing before the Commons Public Accounts Committee, Charles's principal private secretary William Nye was challenged over whether the arrangement gave the Duchy an advantage, but he insisted: "I don't believe it's unfair."
He was grilled by PAC chairman Margaret Hodge, who said: "We want to reflect on the current arrangements to see whether or not they reflect the reality of the world today."
Mr Nye's appearance came as the Duke and Duchess of Cornwall started a summer tour of Devon and Cornwall in the tourist town of Bude.
The Prince, who is also the Duke of Cornwall, voluntarily pays tax on income from the Duchy. But Mrs Hodge questioned why the estate should be exempt from corporation and capital gains tax. She asked what tax would be paid if the JV Energen joint enterprise, which involves the Duchy in a partnership running an anaerobic digester, turned a profit.
Mr Nye said: "The Duke of Cornwall does not pay capital gains tax because he doesn't have access to the capital gains. The capital gains are all reinvested."
He said there was "no particular expectation there will be capital gain" from the JV Energen project.
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