John Caudwell (Image: Ian West/PA Wire)

Midlands billionaire addresses tax loophole and says 'it's not right'

by · Birmingham Live

Birmingham-born billionaire John Caudwell is calling on the Government to scrap tax avoidance schemes - even though he used to benefit from them. The 72-year-old confirmed he was advised to use the loophole schemes when he ran Phones 4U.

But when quizzed on whether he regretted taking advantage of the schemes, he said 'morally it's not right'. According to The Sunday Times Rich List, he is the 109th richest person in Britain - worth £1.54billion.

The self-made billionaire launched what would become Phones 4U with his brother Brian before selling it for £1.46 billion in 2006. He addressed tax avoidance schemes on BBC Radio 4 yesterday (Thursday, November 29).

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He was asked: "Is it fair to say you regret at using some tax-avoidance schemes to find money to put into the business? Could you have done it any differently?"

Caudwell replied: "Ooh gosh, I mean there were legitimate tax-avoidance schemes, of course ethically and morally it’s not right. Yes I could have done it without those tax schemes, but you’re new to business and these tax advisers are pouring through the doors… I changed my views on that dramatically over the years.

"It’s not right, it’s not proper, and I’ve encouraged governments to stamp out all these tax advice schemes which are to the detriment of the British public." With his brother, in 1987 John registered Midland Mobile Phones as a mobile phone wholesaler taking 26 Motorola mobiles at £1,350 each.

It took eight months to sell all 26 phones to plumbers, taxi drivers and television repairmen at a price of £2,000 each, StokeonTrentLive reports. The firm made a loss every month for the first two years of operations.

But the business eventually grew. Caudwell - who was brought up in Stoke-on-Trent - has since concentrated on his charity work including setting up Caudwell Children.