A Cross-Party Group Urges HMRC to Investigate Tax Avoidance After Allegations of Unpaid Taxes on Abramovich’s Offshore Investments

Over 40 British MPs and peers have called for an immediate investigation into whether Roman Abramovich owes up to £1bn in taxes, following a Guardian investigation. The inquiry, which was supported by both Conservative and Labour members, comes after leaked documents shed light on how the former Chelsea FC owner’s offshore companies might have avoided paying taxes on profits from a complex investment structure.

The leaked information reveals that Abramovich’s £4.8bn fortune, built from a $6bn cash pile, was managed via offshore entities, potentially leading to a massive tax liability. Experts suggest these companies failed to pay corporation tax and could now owe HM Revenue and Customs (HMRC) up to £1bn, including interest and penalties. This figure, if confirmed, would exceed the £652m paid by Bernie Ecclestone in 2023 to settle his own tax case.

On Thursday, 43 members of the all-party parliamentary group (APPG) on responsible tax sent a letter to HMRC urging the tax authority to act on the findings. They asked HMRC to assess whether any taxes owed by Abramovich could be reclaimed, particularly in light of the government’s freezing of £3.2bn worth of his UK assets, following his sanctions over Russia’s invasion of Ukraine. These sanctions, imposed by the Foreign Office, identified Abramovich as someone benefiting from or supporting the Russian government.

Joe Powell MP, chair of the APPG, expressed concern over the lack of action, noting that Abramovich’s assets had been frozen, but no funds had been allocated to the victims of the Ukraine war, despite £2.5bn being pledged after the sale of Chelsea FC. Powell emphasised the urgency of recovering any unpaid taxes, given the public need for funds to support public services and reduce national debt.

HMRC has stated that it is committed to ensuring global transparency and that everyone pays the appropriate tax, regardless of their wealth or status. Powell also raised the issue with the government’s leadership, pressing for a review of HMRC’s resources to ensure adequate efforts are made to recover any potential funds owed.

In a separate inquiry, former Conservative leader Iain Duncan Smith urged the Treasury to take action and ensure that any taxes owed by Abramovich were thoroughly investigated and reclaimed. Meanwhile, APPG member Phil Brickell plans to question the Foreign Office about the UK’s potential discussions with Cyprus regarding Abramovich’s case.

A joint investigation by the Guardian, the Bureau of Investigative Journalism, and the BBC has uncovered Abramovich’s involvement in over 200 hedge funds, structured through complex offshore routes in Cyprus and the British Virgin Islands. The UK-based manager of these investments, Eugene Shvidler, has raised questions about whether Abramovich should have paid corporation tax in the UK.

The investigation, part of the Cyprus Confidential series, also uncovered details of a scheme to avoid tens of millions in VAT on Abramovich’s superyacht fleet, which is managed in Italy, Cyprus, and other EU countries. This follows concerns raised by Cypriot MP Alexandra Attalides, who has questioned whether Blue Ocean Yacht Management, a company linked to the yachts, has settled its debts to the state.

This investigation continues to unfold as questions grow over Abramovich’s financial dealings and his responsibility to pay taxes owed to the UK.