The Chancellor, Rishi Sunak, seems to have moved from hero to zero over the last year. Holding the purse strings for the country and determining taxes and benefits, should mean expectations of the highest levels of integrity, ethics and honesty.
Rishi Sunak is known to be extremely rich, with wealth that even exceeds that of the Queen. However, this week it is the Chancellor’s wife who is in the news.
The Chancellor’s wife and non-dom status
The Independent reported that Akshata Murty, who is married to Rishi Sunak has claimed non-domicle (known as non-dom) status as a means of reducing her tax status. Non-dom means that her permanent home is recorded as being outside of the UK. This means that tax may not need to be paid on foreign income. We do not know the exact amount of tax that she managed to save on, but it could run into millions.
While there is no suggestion that she has broken any laws or rules, as we all struggle to deal with a cost-of-living crisis this does not pass the smell test in my opinion.
Response from the Labour Party
Keir Starmer said the arrangements appeared to represent “breathtaking hypocrisy” and showed Mr Sunak is “out of touch” with ordinary people.
Labour has asked Rishi Sunak to be honest over whether he has benefitted from these tax savings, and has said:
“The Chancellor has imposed tax hike after tax hike on the British people.
“It is staggering that, at the same time, his family may have been benefitting from tax reduction schemes.
“Rishi Sunak must now urgently explain how much he and his family have saved on their own tax bill at the same time he was putting taxes up for millions of working families and choosing to leave them £2,620 a year worse off.”
Akshata Murty is the daughter of an Indian billionaire but it’s her stake in her father’s IT Company Infosys worth an estimated £690 million that is relevant to her non-dom tax status as dividends of an estimated £11 million went untaxed last year.
Possible Russian links
It may seem unfair on the Chancellor’s wife to be engulfed in headlines regarding her father’s company’s links to Russia. However, the Chancellor seemed rather uncomfortable when questioned about it on Sky news. Rishi Sunak replied that as an elected politician he was happy to answer questions about his own job only.
Since the intense media speculation around this happened, Infosys has announced it has closed its Russian offices. Was it prompted by unwanted media attention or was it going to happen anyway? We may never know.
What is the real issue here?
We should not have a problem with anyone who is rich or has established a successful business. However, we do expect them to be pay their due taxes in a fair way and to behave in a responsible and ethical manner. While the Sunaks have not broken any laws or rules their behaviour does not sit comfortably with me.
With immense wealth and power come immense responsibilities.