Turnbull under fire on tax haven

Labor has accused Prime Minister Malcolm Turnbull of not playing by the same rules as the rest of the country by investing in funds based in a notorious tax haven.

The attack was launched by Labor senator Sam Dastyari who used parliamentary privilege to accuse the prime minister of inappropriate investments, even though he acknowledged they were legal.

But Mr Turnbull insists all the money he makes from his investments in the Cayman Islands are taxed in Australia and says Labor is engaged in the “politics of envy”.

The prime minister last year noted on his pecuniary interest register that he and wife Lucy bought into the Bowery Opportunity Fund and the CVC Global Credit Opportunity Fund.

The two funds are based in the Cayman Islands, which Australia’s tax commissioner Chris Jordan has described as the sort of tax haven he and his officers want to clamp down on.

Shadow treasurer Chris Bowen asked in parliament whether it remained the government’s position that the Cayman Islands was a tax haven.

Another Labor frontbencher Tony Burke asked the prime minister whether the income he received was boosted by the fact the funds were in the Caymans.

Mr Turnbull told parliament that in order to avoid conflicts of interest he and Mrs Turnbull’s investments were publicly disclosed and in overseas managed funds.

“This means that I and Lucy have no say in which single-name companies those managed funds invest in,” he said.

“All of my or Lucy’s income from investments including funds which are registered in the Cayman Islands is taxed in full in Australia.”

Mr Turnbull said his investments had been approved under the ministerial code of conduct.

Senator Dastyari said it wasn’t fair or right for a prime minister to have investments registered in a tax haven.

“There is one reason people invest in the Cayman Islands – so they don’t have to play by the same rules as the rest of us,” he said.

Senator Dastyari questioned how it was appropriate for the prime minister of Australia to have investments in Ugland House, the listed headquarters for 19,000 companies.

“There is a house in the Cayman Islands, a house where Malcolm Turnbull’s money resides,” Senator Dastyari said.

US President Barack Obama once described Ugland House was “either the biggest building or the biggest tax scam on record”.

Labor and the coalition have been working on ways to stop multinational profit shifting and tax avoidance.

The government has not yet put a figure on how much such measures could reap and Labor says the steps taken do not go far enough.