Labor's attack on Turnbull's Cayman Islands investments is all about image

Extract from The Guardian

Lenore Taylor

The opposition knows the prime minister has almost certainly done nothing wrong, but it is hoping voters will decide he is ‘not one of us’

Labor is trying to paint Malcolm Turnbull as out of touch with mainstream Australia. Photograph: Peter Parks/AFP/Getty Images

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Wednesday 14 October 2015 18.15 AEDT

Labor knows Malcolm Turnbull is very unlikely to have avoided Australian tax on his considerable investments. Having waited so long to win the prime ministership he would surely have guaranteed he didn’t come unstuck because of something as obvious as that.

But proving tax avoidance is almost certainly not the point.

Labor’s aim is to paint the new prime minister as not “one of us”, someone who thinks he’s better, someone who’s out of touch. Not to attack him directly for being rich, of course – Australians quite like someone who’s made their own pile – but to attack him for not seeing the world in the way a person with an ordinary bank account and an ATM card does.

That’s why, when Turnbull announced he would continue to live in his own Point Piper mansion when in Sydney, rather than the official prime ministerial residence, Kirribilli House, Labor strategists were delighted.

No matter that Kirribilli House would still be used for official and charity functions, or that the decision probably saved the taxpayers money. It looked like Turnbull thought Kirribilli House wasn’t good enough for him, they said. It reinforced the point that this was a bloke with his own, superior, waterfront pad.

To a lesser extent and a slightly different audience, Turnbull’s insistence that he would continue to use a private email server for non-classified communications served the same purpose. The arguments about security and transparency were not the political point. The message, Labor said, was simply that this was a bloke who thought the rules didn’t apply to him.

And so, inevitably, the debate has moved to Turnbull’s private wealth. His investments have been thoroughly scrutinised. Even Labor senator Sam Dastyari, who first raised the claims in the Senate, says they are legal and fully and properly disclosed.

But some of Turnbull’s wealth is in three investment funds registered in the Cayman Islands. Turnbull has argued for many months that he invested in the funds in order to avoid all possibility of conflict of interest and that he and his wife pay Australian tax, in full. Labor has produced nothing to disprove this.

It is asking why Turnbull chose managed funds registered in the Caymans – a known tax haven and tax secrecy jurisdiction. It is asking what the funds do, and whether they pay corporate tax. And it is pointing to the Coalition’s highly questionable move to take private individuals out of new domestic tax transparency laws.

By day’s end the Coalition was pointing out that Labor MPs, including Bill Shorten, have their money in super funds that also have investments that are domiciled in the Caymans.

But tactically Labor is betting more people will remember that Turnbull’s riches are stashed in an opaque tax haven in the Caribbean.

They calculate that Turnbull’s frustration at shadow ministers’ “inability to understand the way in which these funds operate” just plays into the their hands. Because most Australians wouldn’t.