James Purnell was the Minister who attacked people living on £65 per week, has introduced non-proven liar software on callers to the DWP, and who has already been revealed as one of those claiming £200 per month "food allowance" also avoided tax on home sales accord to the Daily Telegraph.
The Cabinet minister saved thousands of pounds after informing the parliamentary authorities that Manchester was his “main” home while the tax authorities considered London to be his “primary” residence. Mr Purnell claimed for a £395 accountant’s bill that included “tax advice provided in October 2004 regarding sale of flat” on parliamentary expenses which are intended to cover the costs of running an MP’s office.
Accountants have compared the behaviour of Mr Purnell and Mr Hoon to that of Miss Blears. The ministers are not accused of breaking the law but their behaviour is unlikely to be regarded as ethical by many voters. Capital gains tax of 40 per cent of profits is usually only avoided when selling a main or family home.
Mr Purnell bought a flat in a central London mansion block in 2000 and a house in his Manchester constituency in June 2002. He told the parliamentary authorities that his main home was in Manchester and claimed the “second home” allowance in London. In October 2004, Mr Purnell sold the London flat. He did not pay capital gains tax on the sale as the property was regarded by HM Revenue and Customs as his “principal” residence. It is not known how much profit Mr Purnell made from the transaction. It appears that Mr Purnell received specialist tax advice over the sale of the property and took advantage of a loophole in the rules. This is available to everyone and allows sellers to claim that a property is a main residence for capital-gains tax purposes provided they lived there less than three years before the sale.