Labor says Sunak may have breached cabinet code over wife’s tax status | Akshata Murti
Labor has suggested Rishi Sunak may have breached the Ministerial Code by failing to be transparent about his wife’s non-dom tax status.
Emily Thornberry, the shadow attorney general, raised the possibility after Sunak gave an interview to the Sun newspaper acknowledging that his wife, Akshata Murty, was a non-dom, meaning she didn’t legally to pay UK tax on income earned overseas. .
Sunak has been under pressure for two days over his wife’s tax status and still refuses to say where she pays tax on around £11million of overseas earnings.
The Chancellor said to the sun: ‘She loves her country as I love mine’, and said his wife had done nothing wrong by choosing a financial arrangement which legally exempted her from paying tax in Britain on foreign income .
When asked if he blamed Labor for what he said were horrific libels against his family, Sunak replied: “Yeah.”
But Thornberry told the BBC: ‘We want to know if the Chancellor, well, we know the Chancellor hasn’t said it correctly. It is in the ministerial code that the status of your spouse, the financial situation of your spouse is relevant and the reason is that there may be a conflict of interest.
The Treasury said Sunak declared his wife’s tax status when he became a minister in 2018. However, it is unclear whether he officially declared it to the Treasury when he became Chief Secretary of the Treasury in 2019.
Government sources are said to be content to say that the Treasury “was also aware, in order to manage possible conflicts”, without specifying on what date they were informed.
A Treasury spokesperson said: ‘The Chancellor provided a full list of all relevant interests when he first became a minister in 2018, as required by the ministerial code. The Independent Advisor for Ministers’ Interests confirmed that they were fully satisfied with the steps taken by the Chancellor to meet the requirements of the code.
Murty, a businesswoman whose wealth is estimated at hundreds of millions of pounds, is an Indian citizen and reportedly owns a 0.91% stake in Infosys, an IT company founded by her father. Her share is thought to be worth £11.5million a year, meaning she may have avoided up to £20million in UK tax by not being domiciled in the UK -United. Murty said she pays taxes overseas.
A report in The Times suggested anonymous allies of the Chancellor had claimed the Prime Minister’s Office was behind the leaks – allegation No 10 and No 11 strongly denied.
A Treasury source said: “It is categorically untrue that Rishi or anyone else in his team thinks this is from No 10.”
A spokesperson for No 10 told PA Media: ‘It is categorically untrue that No 10 is behind the briefings. The Prime Minister and the Chancellor are united.
Sunak told The Sun that Murty was eligible to use the non-dom arrangement as she was an Indian citizen and planned to return to her home country to care for her parents.
On Wednesday, Murty claimed she was automatically granted non-dom status as an Indian citizen. But tax experts said she would have to choose to apply for the status every year. Murty is paying £30,000 a year for his non-domiciled status, his spokesperson has confirmed. The status will automatically cease once she has lived in Britain for 15 years – which would be in 2028.
The Chancellor said it was ‘unpleasant’ to read of attacks on his wife ‘especially when she has done nothing wrong’. “She didn’t break any rules. She followed the letter of the law,” Sunak told The Sun.
He said Murty “pays full UK tax on every penny she earns here in the same way she pays full international tax on every penny she earns internationally “.
He said he would never dream of asking his wife to renounce Indian citizenship in the name of her political career.
He said: “I hope most unbiased people will understand – although I understand it’s a confusing situation, that it’s from another country.” He added: ‘Those are his choices, aren’t they? She’s a private citizen, and of course I support my wife’s choices. She does not belong to her husband. Yeah, he’s in politics, and we understand that, but I think, you know, we understand that she can be a person independent of her husband in her own right.
Labor has hit back at claims it was responsible for the leak, with a party source telling PA Media: “The Chancellor better look a little closer to home. It’s clear that No. 10 is the one briefing Rishi Sunak and, after his failure to tackle the cost of living crisis, you can see why.
Labor leader Keir Starmer said on Thursday Sunak could be guilty of ‘breathtaking hypocrisy’ if his wife slashed her own tax bill as the incumbent No 11 hiked National Insurance for millions of Britons .
Murty confirmed his non-dom status after the independent website first reported the arrangement on Wednesday, the day the 1.25 percentage point National Insurance hike took effect.
This means his permanent residence is considered to be outside the UK, despite the Sunaks living in Downing Street.