THE Tories are facing a fresh scandal after HM Revenue and Customs turned down a French request to help with a probe into a major Conservative Party donor.
Controversy erupted after BuzzFeed News reported the tax and payments authority sent correspondence regarding their decision not to seek a search warrant for Lycamobile which cited that the telecoms company was the "biggest corporate donor to the Conservative party" and had given money to the Prince Charles Trust.
Shadow chancellor John McDonnell said: "If true, these are deeply concerning revelations. The fact that a Tory donor could be allowed to potentially subvert the system will look bad to taxpayers who play by the rules.
"The Tories have serious questions to answer on this matter, and I hope the Chancellor immediately comes forward to explain this behaviour by HMRC and ensure there was no undue pressure exerted by Conservative Party politicians or officials."
Labour leader Jeremy Corbyn said: "HMRC is a Government agency, it is part of our Government and it should investigate every company without fear and without favour about its tax affairs to make sure they pay the correct amount of tax and there's no hiding place, no evasion from it, whoever they are."
A spokesman for Lycamobile said: "Lycamobile has not contributed to the Conservative Party since July 2016. Lycamobile continue to deny all allegations being implied by BuzzFeed."
An HMRC spokesman said the organisation acted correctly as there were not enough details given by the French authorities to secure a search warrant.
He said: "The application contained insufficient detail to satisfy the legal requirements to secure a warrant.
"After the French request was rejected, HMRC continued to liaise with the French authorities to explain the statutory requirements for a UK search warrant, and offered to meet the French judge face to face to explain those requirements.
"HMRC always investigates suspected rule breaking professionally and objectively and is never influenced by political considerations.
"The facts speak for themselves: last year alone we secured an additional £8 billion in tax from the largest businesses by tackling avoidance, evasion and non-compliance."
HMRC sources said facts about political donations were contained in the correspondence as "background information."
Prime Minister Theresa May's spokesman told a Westminster briefing: "HMRC never takes political donations into account when it makes decisions on whether to investigate a business.
"The request was rejected because it did not contain sufficient information for HMRC to seek a search warrant.
"My understanding from HMRC is that the information was only provided as background to offer a detailed profile of the company to their French counterparts but it was not taken into account by HMRC in deciding whether to support the French application."
A Conservative Party spokesman said: "All donations to the Conservative Party are properly and transparently declared to the Electoral Commission, published by them, and comply fully with the law."
Tory sources said the party decided to stop taking donations from Lycamobile nearly two years ago, and has not received any since July 2016.
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