K is for Klutz

Ken Livingstone was all over the news yesterday - fending off accusations of being a tax avoider.

The allegations come in the wake of Ken - London's most famous socialist and left-wing firebrand - placing earnings of £750,000 over three years into a limited company.

Which means that Ken paid around 20% in corporation tax on his earnings - instead of the 50% which is  due on individual earnings above £150,000 a year.

The new 50% tax rate was introduced as an emergency measure under the last Labour government - because of the dire mess of the economy - and I'm pretty sure it would have had the enthusiastic support of 'Red' Ken at the time.

Yet Ken chose to divert his earnings into a company - which is entirely legitimate - even if it does undermine his somewhat tarnished image as a left-wing firebrand and self-styled man of the people.

Now what I'd like to know is what exactly Ken has been doing to earn £750,000 in three years - during which he has attacked tax avoiders as 'rich bastards' according to the newspapers.

A Labour candidate on the 2010 general election criticised Ken by saying:

"Your relentless cynicism and negativity is matched only by your hypocrisy. And I mind all three."

Ouch - is all you can say to that.

Ken has dismissed the tax avoidance row as a smear campaign by his political enemies - but he didn't have to channel his earnings through a company of course - that was an entirely personal choice.

Some of the funds appear to have gone on a salary for his wife - a favourite way of maximising the household income amongst politicians - and for some unexplained reason £19,000 was apparently paid as a 'donation in kind' to the Labour party - for three months work.

Now the last time I did the math 4 x £19,000 = £76,000 for a year's worth of such work - so it must have been of very high quality indeed.

The problem is we'll never know - because that's the other thing about channelling his earnings through a limited company - these details are all kept under wraps.