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Labour rejects criticism from former M&S and B&Q bosses Boris Johnson enters Boots v Labour tax row
(about 4 hours later)
Labour has dismissed further criticism from senior business figures, saying the attacks are politically motivated. Boris Johnson has weighed into the row about the amount of tax paid by Boots and its chief executive in the UK.
Former Marks and Spencer boss Lord Rose accused the opposition of a "steady drumbeat of anti-business policies". The mayor of London said it was "disappointing" Stefano Pessina did not pay tax in Britain and the firm moved its HQ to Switzerland for tax purposes.
Ex-B&Q head Sir Ian Cheshire defended the right of business leaders to speak out on key issues and said they should not be subjected to abuse for doing so. Ed Miliband has attacked Mr Pessina as a "tax exile" after he warned a Labour government would be a "catastrophe".
But Labour said the new attacks were "ridiculous", pointing out that Lord Rose was a Conservative peer. Other business leaders have rallied behind Mr Pessina, saying he should not be subjected to personal attacks.
Ed Miliband has suggested there is an "unholy alliance" between some business people and the Conservative Party to resist change in areas such as taxation and regulation. Labour has suggested there is an "unholy alliance" between some business people and the Conservative Party to resist change in the run-up to May's election and has vowed to take on "powerful forces" over the amount of tax paid by multinationals, as well as on wider issues of taxation and regulation.
The opposition's relationship with business has come under scrutiny three months before the general election after the head of Boots, Stefano Pessina, claimed that if Labour went through with some of the policies it had put forward in opposition it would be a "catastrophe" for the country. 'Tax exile'
In response, Mr Miliband and other senior Labour figures said Mr Pessina should not "lecture" people and questioned both his and Boots' record of paying taxes. Mr Pessina, who took over the High Street retailer when it merged with Universal Unichem in 2007, has suggested Labour policies in such areas would be "unhelpful for the country".
Lord Rose, who headed M&S for a decade and was, for a time, an adviser to the last Labour government, defended Mr Pessina's right to voice his concerns. This prompted an angry response from the Labour leader, who said a "tax exile in Monaco" should not "lecture" people on how to vote in May's election and Mr Pessina "ought to pay his taxes" in the UK.
Mr Johnson told LBC Radio that Mr Pessina was "perfectly entitled" to express his view on the business landscape in the UK and it was "refreshing" that businessmen did not feel cowed from speaking up so close to an election.
Mr Johnson, who is hoping to return to Parliament as a Conservative MP in May, said it was "absolutely true" that Labour had "no interest" in wealth creation.
But he said that it was "slightly disappointing" that Boots had moved its headquarters from Nottingham to Switzerland in 2008, a move experts have said is saving the firm millions of pounds every year.
"He is doing his best by the lights of his shareholders and the interests of the company," Mr Johnson said.
"These guys, I'm afraid, have a fiduciary duty to their shareholders to minimise their obligations. In business terms, it's what you have to do.
"I have to say I find it a little bit disappointing that he doesn't cough up for Britain ... I think it is a good thing if companies that earn great sums in Britain should pay their taxes in Britain."
'Business backbone'
Responding to Mr Johnson's comments, Labour challenged David Cameron and George Osborne to "join the criticism of tax avoidance by the Boots chief".
A Downing Street spokesman said it was "absolutely right that companies that enjoy the benefits of operating in the UK must pay a full and fair share of tax on profits they make in the UK".
But Lord Rose, who headed M&S for a decade and is now a Conservative peer in the House of Lords, defended Mr Pessina's right to intervene in a political debate.
"As a man responsible for 70,000 workers - that's 70,000 livelihoods supporting 70,000 families - Mr Pessina was perfectly entitled to speak out," he told the Daily Mail."As a man responsible for 70,000 workers - that's 70,000 livelihoods supporting 70,000 families - Mr Pessina was perfectly entitled to speak out," he told the Daily Mail.
"What happens in Westminster has a direct impact on his employees and his customers.""What happens in Westminster has a direct impact on his employees and his customers."
Mr Miliband, he suggested, had "blown apart" decades of political consensus that the business sector should be cherished as an engine of growth. He added: "In a healthy, thriving democracy, people must be free to speak out without fear or favour," he added.
Labour, he suggested, had engaged in a "steady drum-beat of anti-business policies" and lacked "a clear and credible plan" to deal with the deficit.
"In a healthy, thriving democracy, people must be free to speak out without fear or favour," he added.
"This is the real face of British business. They aren't the enemy. They are the backbone of our economy - and they deserve the support and respect of our politicians.""This is the real face of British business. They aren't the enemy. They are the backbone of our economy - and they deserve the support and respect of our politicians."
'World force' 'Reputational damage'
Lord Rose was given a peerage by David Cameron last year and sits as a Conservative peer in the House of Lords. Sir Ian Cheshire, the former boss of B&Q, said politicians should refrain from "unattractive" personal attacks even if they disagreed with others' point of view.
Sir Ian also defended Mr Pessina and said politicians should refrain from "unattractive" personal attacks even if they disagreed with others' point of view.
"He has the complete right to have his say, as have other people," he told the Daily Telegraph. "Even if you disagree with him, I don't think it is necessary to have personal attacks on Stefano in this way - particularly for a guy who has really ploughed a lot of money into the UK and is doing now to make Boots a world force.""He has the complete right to have his say, as have other people," he told the Daily Telegraph. "Even if you disagree with him, I don't think it is necessary to have personal attacks on Stefano in this way - particularly for a guy who has really ploughed a lot of money into the UK and is doing now to make Boots a world force."
Sir Ian, who stepped down as head of Kingfisher last year, was recently named as the government's top non-executive director, advising departments across a range of issues.Sir Ian, who stepped down as head of Kingfisher last year, was recently named as the government's top non-executive director, advising departments across a range of issues.
In response, Labour said the attacks were "not a shock". "No-one should be surprised a Conservative politician is attacking the Labour Party," its press office tweeted. Conservative backbencher John Redwood suggested the row risked damaging Boots' reputation as well as Labour's and business leaders needed to think carefully before wading into political controversies in the name of their companies.
'Business bashing' "By all means let's hear from Mr Pessina as an individual with his anti-Labour views, but let's hear less from Boots," he wrote on his blog.
Labour has been criticised in some quarters for its plans to freeze energy bills, introduce a tax on properties worth more than £2m and raise the top rate of tax to 50p. "Labour now sees it as an opportunity to put the boot into Boots, as they are stung by the criticism. Neither Labour nor Boots will gain from these rows."
Some business leaders are uneasy about Labour's plans to freeze energy bills, introduce a tax on properties worth more than £2m and raise the top rate of tax to 50p.
Labour has insisted that it has a pro-business agenda, citing its pledge to cut corporation tax for small businesses and its support for the UK to remain in the EU.Labour has insisted that it has a pro-business agenda, citing its pledge to cut corporation tax for small businesses and its support for the UK to remain in the EU.
However, the opposition has vowed to take on "powerful forces" in the business world over the amount of tax paid by multinationals and their bosses.
The Conservatives accused Labour of "business bashing".
"Glad Ed Miliband's weak attempts to silence business leaders with unpleasant personal attacks is being called out," business minister Matt Hancock tweeted.