To ask Her Majesty's Government what is their response to comments made on the Today programme on 17 September, by Harold Peters, an Ascension Island councillor, concerning an alleged shortfall in the island's tax revenue due to the Royal Air Force paying £497,000 rather than the £1 million that is believed to have been due each year since 2002. [HL5845]

The decision by the Ascension Island Government to remove a variation in the Ministry of Defence's annual property tax liability, which had the effect of almost doubling the amount, is currently being disputed. The MoD, therefore, has not paid this new tax liability in full.

Discussions are ongoing in order to seek an agreement that is fair and equitable, and assurance that the services received from the Ascension Island Government represent best value for money. The Ascension Island Council has commissioned an HMRC-led study, supported by the Foreign and Commonwealth Office, into tax arrangements on Ascension Island. The Ministry of Defence is being consulted as part of this study.