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What’s wrong with Britain? Let’s start with the monarchy
By: []
Date: 2021-09
On 12 October 2018, Princess Eugenie married Jack Brooksbank at Windsor Castle, in a ceremony funded in part by the Sovereign Grant, the British government’s annual payment to the monarchy. At my local gym that day, I overheard two people discussing the day’s events.
“I hate it when people moan about how much money royal weddings cost,” one said. “This country has more important problems to worry about. I thought she looked beautiful.”
This is neither the first nor the last time I have heard such sentiment. In the six years I’ve been writing my new book, ‘Running the Family Firm: How the monarchy manages its image and our money’, I have been asked many times why I spend so long thinking about monarchy when we are faced with seemingly more important global inequalities.
My reply is that to understand these other problems, we must understand monarchy, particularly in the British context. While research and commentary on elite corporate power is increasingly being used to understand global inequalities, the monarchy is very rarely considered as part of this. It’s often dismissed as an archaic institution, an anachronism to corporate forms of wealth and power, and therefore irrelevant.
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Meanwhile, the monarchy is moralised in media culture through representations of national identity, ‘the family’ and philanthropy, which circumvent questions of inequality, aristocratic state power and privilege. The gym-goer’s comment – “I thought she looked beautiful” – is doing precisely this: masking monarchical power through individualised ideologies of gender, fairytale and love.
However, the relationship between monarchy and capitalism is as old as capitalism itself. To pretend the monarchy is a banal tradition is to completely overlook centuries of exploitation and accumulation that have helped it to survive.
The Firm and tax avoidance
In my book, I describe the monarchy as a corporation – the Firm – to expose its underlying capitalist logic. One example of where this came to light was during the leak of the ‘Paradise Papers’ on tax global avoidance, which revealed that the Duchy of Lancaster – the Queen’s private estate – had used offshore private equity funds to avoid paying more tax on its holdings. Global corporations such as Apple, Nike and Facebook were also embroiled in the scandal.
By law, the Crown is exempt from taxation, and the Sovereign Grant is exempt from income tax. In 1992, responding to anger over public funds being used to restore Windsor Castle after a fire, the Firm agreed to pay ‘voluntary’ income and capital gains tax on private investments and the Privy Purse, the sovereign’s income from the portfolio of land, property and assets held by the Duchy of Lancaster – but only “to the extent that the income is not used for official purposes”. At the time, the exact sum of this income tax, as well as the size of the wealth the income is taxable from, remained undisclosed. The Crown is also exempt from inheritance tax on “sovereign to sovereign bequests”, meaning assets can pass from monarch to monarch without alteration or loss of wealth.
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