The condition of Ori party chairman Nadim Zahawi is “untenable”, Labor has said following reports he has paid a fine as part of a multimillion-pound tax settlement.
The former chancellor, who joins Rishi Sunak’s cabinet, was under pressure after it was reported that he paid a seven-figure sum to HM Revenue and Customs to end the dispute.
Deputy Prime Minister Dominic Raab defended his colleague, saying Mr Zahavi “has been very clear that he has paid all the taxes he is owed” and “If there are further questions… I am sure That there would be proper transparency”.
The fact that Nadeem hasn’t gone out on the airwaves to explain himself to me adds insult to injury, especially considering he called it a smear at the time.
Labor sought an explanation after The Guardian reported that Mr Zahavi paid 30% of the fine, taking the estimated total tax bill to more than £4.8 million.
Mr Zahavi’s team has been contacted for comment on the latest allegation.
Labor deputy leader Angela Rayner told BBC Breakfast: “The fact that Nadim hasn’t come out on the airwaves to explain himself to me adds insult to injury, especially given that he called it a smear at the time and sent legal letters to people who legitimately asked questions about it.
“And when you are Chancellor, who is in charge of UK tax matters, and you have money of that nature, you will be expected to know about your tax matters or seek advice at that time, paying those taxes.” Against not doing and giving penalty notice.
“I believe his position is untenable. If he has lied and misled the public and HMRC about his tax affairs then I think his position is untenable.
Mr Raab told Sky News: “I can’t speak about a colleague’s personal tax matters, but what I will say is that Nadim has been very clear that he has paid all the tax that he is owed, that He’s paid on time, that there’s nothing owed, and I think that’s certainly right and fair.
“If there are more questions, of course, I’m sure there will be proper transparency.”
Asked whether Mr. Zahavi would still be in office in a month, Mr. Raab said: “A month is a long time in politics. I certainly hope so.”
Mr Zahavi allegedly used an offshore company registered in Gibraltar to hold shares in the polling company YouGov.
YouGov’s 2009 annual report showed a holding of over 10% by Gibraltar-registered Balshore Investments.
The report described the company as “the family trust of Nadim Zahavi”, who was at the time an executive director of the polling firm.
Tax lawyer Dan Needle estimated Mr Zahavi owed £3.7 million, and said that with interest payable on top of the reported 30% fine, the total could exceed £4.8 million.
Mr Niddle, of the Tax Policy Associates think tank, said: “If your tax affairs are in order you don’t pay the 30% penalty.
“You do it best if you have been negligent if you have not paid the tax due.”
The government website says that arising due to lack of due care, a fine of up to 30% is payable. Intentional defaults can result in fines ranging from 20% to 70%.
A spokesman for Mr Zahavi previously said his taxes were “properly declared and paid in the UK” and the minister “never had to instruct a solicitor to deal with HMRC on his behalf”.
Mr Sunak has defended the Prime Minister’s Questions on Wednesday by stating that Mr Zahavi “has already fully addressed this matter and there is nothing more I can add”.
Questions about Mr Zahawi’s tax affairs have added to several challenges this week for the prime minister, who was fined by police for not wearing a seatbelt in the back of a moving car.
(tags to translate) Dominic Raab