When it comes to tax, most of us pay it and most of us probably pay our fair share, and even a proportion of corporations (multi-national or otherwise) end up paying some degree of tax - despite the best efforts of creative accountants. The question of what exactly is a corporation and how much tax it should pay came before the House of Commons Public Accounts Committee (last month) in relation to the Duchy of Cornwall.
The Duchy of Cornwall, the Committee heard, provides the heir to the throne was a private income, was not a corporation and that the prince voluntarily pays income tax. The Duchy of Cornwall, despite the name, happens to have significant landholdings well to the east of the Tamar which included the Oval Cricket Ground in London and a third of Dartmoor, not to mention pretty extensive property in Cornwall itself. It is worth noting that the "title and honour" confers legal prerogatives in Cornwall which elsewhere belong to the Crown including for example the right to the property of people who die without heirs and ownership of the foreshore. Interestingly the duchy estate is worth some £762 million pounds.
A Royal aide revealed that the prince's estate does not pay capital gains tax because he "doesn't have access to the capital gains. The capital gains are all reinvested in the duchy for future dukes". MPs were that the profits were used to pay for the prince's public duties, as well as those of his wife the Duchess of Cornwall and those of Prince William, the Duchess of Cambridge and Prince Harry and that if parliament legislated to prevent Prince Charles using his private income in this way it would cost taxpayers more - to pay for his official duties - and he would be free to spend his money "on his other things".
A senior Treasury official told the committee, that the prince's tax arrangements worked this way because he does not pay capital gains tax because he always reinvests any profit from sales, and that "If the duke were to be taxed on the corporate income of the duchy as well as his income, he would be taxed twice." The Treasury official also stated that the duchy differed to other corporations because the prince "is in the unusual position of getting all the income." The duchy estate of land and property - mostly in the south-west of England - was established by King Edward III in the fourteenth century to provide a private income for his son and heir to the throne.