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HMRC rents its HQ from a company registered in a tax haven

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HMRC rents its HQ from a company registered in a tax haven

Without wishing to sound like Richard Littlejohn: you couldn't make this up.

Following the release of the 'Panama Papers' - eleven million sensitive documents dating back 40 years, originating from the clandestine Panamanian law firm Mossack Fonseca - the huge job of wading through the files to discover the wider ramifications has begun.

The documents threaten to expose exactly how the wealthy and powerful use the global offshore system in order to avoid paying tax. It's already cost one Prime Minister his position, with Iceland's PM Sigmundur Davíð Gunnlaugsson 'stepping aside' yesterday.

And there's another, rather gloriously ridiculous revelation that's emerged: the companies that Her Majesty's Revenue and Customs Office (HRMC) pays rent to for its London headquarters, along with 600 subsidiary offices, are registered in tax havens.

The companies responsible are CIHL Infrastructure Holdings, which is registered in the tax havens of Jersey and Mapeley Steps Limited, which is registered in Bermuda, with the rental arrangement arising as the result of a private finance initiative (PFI), a highly controversial method of using private money to build things, which are then leased back to the public sector. These often make the government's books look good in the short term - as their borrowing costs are down - but cost hugely more over the long term than if the government had simply stumped up the cash in the first place. Currently, experts believe that PFI deals will cost the country £209bn over the course of the next 35 years.

Private Eye writer Richard Brooks had first revealed the set up in 2012 in his book The Great Tax Robbery, but these documents confirm that, incredibly, it's actually true.

Meanwhile, it has been revealed that over half of the companies listed in the documents are registered in the UK, or in UK-administered tax havens - and in the last five years HMRC has prosecuted just 11 offshore tax evaders.

While the rental income that the company receives in the UK is taxed, it's nonetheless a highly worrying development that a company so closely linked to the body that is supposed to be overseeing a crackdown on tax avoidance is incorporated in a tax haven itself.

(Image: Shutterstock)