Taxing questions

Sunak is put on the defensive

THERE CAN be no doubt that the wife of Chancellor Rishi Sunak has behaved completely honestly and complied with the letter of the law in her tax arrangements.

Akshata Murty holds nondomiciled status, which enables her to earn money from abroad free of UK tax.

She is the daughter of an IT billionaire, and her stake in his company, based in India, is worth a reported £690m.

It will seem strange to many that the Chancellor’s wife, living in his North Yorkshire constituency of Richmond and at 11 Downing Street, should benefit from tax arrangements designed for those whose principal home is abroad.

Though perfectly legal, this state of affairs simply does not look good, especially at a moment when the Chancellor has increased national insurance, a key element in the cost of living crisis that is a huge worry for so many people.

The Labour leader Sir Keir Starmer is likely to receive widespread support for his call for Mr Sunak to be completely transparent about his wife’s tax affairs.

Inevitably, this matter places the Chancellor on the defensive, and protesting that his wife is not a politician and therefore should not face scrutiny – as has previously been the case –is unlikely to convince the public.

There can be no quibbles about his wife earning money from her family’s business, which she is absolutely entitled to do. But if she is perceived as obeying the law on tax arrangements, yet failing to observe its spirit, that will only result in political damage to the Chancellor – who some see as the future Prime Minister.