Two of party's biggest corporate donors are controlled from British Virgin Islands, while senior Lib Dems have links to havens
Vince Cable's pledge at the Liberal Democrats' autumn conference to work with allies to close down tax havens may not go down well with two of the party's most generous corporate donors.
The business secretary told delegates he would crack down on those who used secretive, low tax jurisdictions: "No one keeps their cash in tax havens for the quality of investment advice; these are sunny places for shady people," he said.
Danny Alexander, the chief secretary to the Treasury, will on Tuesday announce further measures that he claims will retrieve £3bn hidden from the UK government in one European tax haven.
Alpha Healthcare and its sister company C & C Alpha Group, part of a venture capital group in the private health sector, have together donated £970,000 to the Lib Dems since 2004. Alpha's parent company, Harberry Investments, is based in a small office in Tortola in the British Virgin Islands – named as a tax haven by Congress in the US. Bhanu Choudhrie, a director in both donor companies, has also given a personal donation of £35,000 to the party. His father, Sudhir Choudhrie, who was once involved as a director of companies in the Alpha group but has now stepped down, has given a further £95,000 to the party since 2006.
The Choudhrie family, originally from India, was first introduced to the party by Simon Hughes, the Lib Dem MP for Bermondsey in south London.
Both Choudhries said in 2010 that they were domiciled outside Britain for tax purposes. If this is still the case they can, if they wish, avoid British tax on any income or gains from their overseas assets.
Contacted on Monday, one of the company's directors, Dhruv Choudhrie, declined to comment on Cable's speech, saying he was abroad. A spokesman for the company did not respond to emails or telephone calls.
Some senior Lib Dems have maintained close links to offshore havens. Lord Razzall, a former Lib Dem trade and industry spokesman, sits on the board at a firm called Ardel Holdings. The company is based in Guernsey and offers services including tax mitigation for clients, promising that "income can be rolled up tax free". Ardel helps with tax mitigation through "fiduciary structuring" for businesses and individuals. It also helps non-domiciled UK residents exploit non-taxable offshore funds.
Its website says: "The benefits and flexibility delivered by offshore companies make them a highly attractive option for clients."
Razzall said: "As an adviser to the owner of Ardel Holdings for the last 25 years I have always been satisfied that the business does not engage in activities of the type criticised by George Osborne."
The former Liberal leader Lord Steel is a non-executive director of General Mediterranean Holdings, a Luxembourg-established company set up by Nadhmi Auchi, an Iraqi-born billionaire. Steel said the company's headquarters were in Luxembourg and it held most board meetings there.
At the party's conference in Brighton Alexander will set out new resources to help tackle what he calls "tax dodgers". He will say: "With that extra effort we can recover much more from those who think they can hide their money offshore. Up to three times more – £3bn."
A spokesman for the Liberal Democrats said: "Liberal Democrats are committed to targeting companies and individuals who are using aggressive tax avoidance measures by hiding money off shore. In some cases, there are legitimate reasons for global companies to not base themselves in the UK, and even corporations such as the Guardian Media Group have on occasion used the Cayman Islands.
Regarding the donations from Alpha and C & C, he added: "They are part of global groups which have UK based businesses, paying full UK tax and employing British workers.
"But as Vince Cable and Danny Alexander have made clear, Liberal Democrats will be cracking down on anyone using tax havens to solely avoid paying a fair share of tax in the UK."