Steelgate donor uses UK tax loophole

THE Labour donor who sparked the "Steelgate" row avoids paying tax in the UK through a loophole Tony Blair pledged to close, it was reported today.

Lakshmi Mittal’s firm LNM, which received the Prime Minister’s backing in its successful bid to buy Romanian state steel firm Sidex, does not pay tax in the UK because it is registered abroad. And the Indian billionaire has "non-domicile" status, exempting all personal income generated outside Britain from tax.

Mr Blair pledged to end the loophole before coming to power in 1997, the paper said. Only a fraction of Mr Mittal’s fortune, estimated at between £1 billion and £2bn is liable to tax in the UK under the scheme, according to reports.

Support for Tony Blair and his Government is up two per cent despite what has been dubbed the Prime Minister’s worst week in office, according to a new poll. One in four voters said "Steelgate" had damaged Mr Blair’s reputation. Most of those were Tory or Lib Dem supporters, according to the ICM poll published today, which also showed Labour’s lead on the Tories was at 17 per cent.