Prince Charles' Duchy Estate Defends Tax Breaks By Paul Harrison, Royal Correspondent The Duchy of Cornwall does not possess a "competitive advantage" over other businesses despite being exempt from hefty taxes, a spokesperson for Prince Charles' estate has told Sky News. The comments come as the Public Accounts Committee (PAC) publishes its report on the accounts of the 700-year-old Duchy of Cornwall estate. Under the Duchy, established in 1337 by King Edward III, the heir to the throne is exempt from paying corporation and capital gains taxes on land and property transactions. But while the current Duke of Cornwall, Prince Charles, is technically exempt from paying income tax, he has volunteered to do so since 1993. The Duchy of Cornwall estate was established by King Edward III in 1337 The Duchy spokesperson told Sky News: "We do not believe we have a competitive advantage. The Duke of Cornwall's income is taxed at income tax rates. The Duchy is not subject to corporation tax and the Duchy is not a corporation ... any capital gains have to be reinvested in the business and cannot be distributed. But the PAC's Margaret Hodge MP wonders whether the Duchy's unique tax arrangements allow for a level playing field when the estate stands alongside other businesses. She said: "If you're letting property to a Holiday Inn in Reading or to Waitrose to run a big depot on an industrial estate, are the terms of that enabling other competitors in that market to compete on an equal and level playing field? What started off 700 years ago as a medieval estate, today demonstrates all the features of a modern big corporation, yet it hangs on to old habits such as exemption from corporation tax. The Duchy's main activity is the management of land and properties which make up its estate, providing an income for the present and future Dukes of Cornwall. Its portfolio is made up of 131,000 acres of land, properties spread across 24 counties and more than 3,500 individual lettings. All together over the last financial year it generated £28.8m and the Prince received an income of £19m, up 4% on the previous year. The estate owns property including the Kia Oval in south London The money is partly used to fund his and his family's public, charitable and official duties and the Prince voluntarily pays income tax on the cash left after costs, around £9.2m last year, according to the PAC. Margaret Hodge believes the Treasury falls short of proper scrutiny when it comes to the Duchy's finances. She said: "It [The Treasury] relies on the Duchy to provide it with accurate information without carrying out its own independent checks. Details of the Treasury's approvals for the Duchy's proposed land transactions over £500,000, of which there are around 15 a year, are not published. Greater transparency is needed. In answer to the PAC findings, the Treasury said: "HM Treasury's role is to ensure that the Duchy of Cornwall is managed in a sustainable way and that the strategic choices made by the estate's managers are in its long-term interests and those of current and future dukes. The Treasury has a constructive working relationship with the Duchy, and challenges decisions where appropriate.