Barlow should keep OBE, says PM

David Cameron has dismissed calls for Gary Barlow to hand back his OBE after the Take That star was ordered to pay millions of pounds in tax dodged through an avoidance scheme.

Prime Minister David Cameron stands with singer Gary Barlow during a reception at 10 Downing street
Prime Minister David Cameron stands with singer Gary Barlow during a reception at 10 Downing street

The Prime Minister said it was not "necessary" to remove Barlow's honour because he had "done a huge amount for the country" and "raised money for charity".

The staunch defence came despite Mr Cameron having previously condemned comedian Jimmy Carr for investing in a similar tax scheme. The premier also faced embarrassment when a video emerged of him praising Barlow, who lives in his Witney constituency and supported the Tories at the last election, as a "really lovely man".

Barlow and two other members of Take That have refused to comment on reports over the weekend that they are in line for tax bills totalling tens of millions of pounds after a court ruled a partnership in which they invested was a tax avoidance scheme.

The singer, along with Howard Donald, Mark Owen and their manager Jonathan Wild, apparently invested £66 million into two partnerships styled as music industry investment schemes.

Judge Colin Bishopp ruled that 51 partnerships, set up by Icebreaker Management, were to secure tax relief for members and HM Revenue and Customs is now expected to demand repayment.

It was alleged in 2012 that Barlow, Donald, Owen and Wild invested at least £26 million in a scheme run by Icebreaker Management.

At the time Take That's lawyers insisted the band mates believed the investments were legitimate enterprises and that all four named paid "significant tax".

Speaking on ITV's Good Morning Britain, Mr Cameron said: "Gary Barlow has done a huge amount for the country, he has raised money for charity, he has done very well for Children in Need, so I'm not sure... the OBE is in respect of that work and what he has done.

"But clearly what this scheme was was wrong and it is right that they are going to have to pay back the money."

The premier repeated his condemnation of "aggressive" tax avoidance schemes.

"I am against these aggressive tax avoidance schemes but I am not just against them - this Government has taken a huge amount of steps to legislate and toughen the laws and go after aggressive tax avoidance schemes for the very simple reason that if people go after these schemes and aggressively avoid tax they are making it the case that everyone else has to pay higher taxes as a result," he said.

"I think we should be very clear, tax evasion is illegal, and for that, you can be prosecuted, you can go to prison for tax evasion.

"Tax avoidance is, in these cases, these very aggressive tax avoidance schemes, they are wrong, and we should really persuade people not to do them.

"That is why we have these court cases where the court looks at whether a scheme is really about avoiding tax rather than anything else. The court was very clear in this case."

But Labour's Margaret Hodge, chair of the Public Accounts Committee - which has undertaken a number of investigations into tax avoidance - said Barlow "might want to show a bit of contrition by giving back his OBE".

Liberal Democrat Chief Secretary to the Treasury Danny Alexander said: "People who don't pay the taxes that they should undermine the economy, damage our public services and place an extra, unfair burden on hard-working families and companies who play by the rules."

Conservative MP Charlie Elphicke told the Times newspaper: "People who have seriously abused the tax system should be stripped of their honours."

Barlow, 43, who has spent more than 20 years in the public eye, was awarded his OBE by the Queen in November 2012.

He was given the honour for services to the entertainment industry and to charity.

Barlow masterminded the Queen's Diamond Jubilee concert, which was staged at Buckingham Palace during a special bank holiday weekend in June 2012 and featured a host of stars including Stevie Wonder and Sir Paul McCartney .

As the creative force behind Take That between 1990 and 1996 and since they reformed in 2005, and with his solo success, Barlow has topped the singles charts 14 times and received five Ivor Novello awards for his song-writing.

His charity work includes gathering a team of celebrities to climb Mount Kilimanjaro in 2009 for Comic Relief and organising charity concerts for Children in Need in 2009 and 2011.

Mr Cameron, who appeared at a Tory event with Barlow in the run-up to the last general election, praised him while out campaigning last week.

A Sky News video showed the PM telling two Take That fans: "He lives in my constituency in West Oxfordshire... He is such a nice man.

"We did a music for schools thing back in 2010 and he was so charming. A really lovely man. He is a lovely guy."

Shadow chancellor Ed Balls told BBC Three Counties Radio it was right that such tax avoidance schemes were closed.

But he stopped short of saying that Barlow should lose his OBE, insisting that was a matter for the independent forfeiture committee.

"I think it's important, where there are schemes which are clearly set up and designed simply to avoid tax that the Treasury, the Inland Revenue really comes down hard," he said.

"And when you have examples like this which are clearly being exposed as just a way of avoiding tax, why should the people with the highest incomes making millions of pounds from everybody else's tax money - why should they get off without paying their fair share of tax? That's not fair and it's quite right that this is cracked down on.

"It's something that the Government have been rather weak about in the last few years because they have been cutting the number of inspectors, the people who can really go after this, and I think it will take a Labour government to really crack down on this."

He went on: "We have an independent system for giving out honours, it's not decided by politicians, it is decided independently and there is also an independent committee which looks to see whether or not honours should be taken away. I don't think it's sensible for me or the PM to be judge and jury.

"I am not going to say he should keep it or he should lose it, there is an independent process.

"But clearly this tax avoiding dodge was wrong and I'm sure he is going to apologise for it."