British PM Rishi Sunak orders probe into ally's tax affairs

LONDON - British Prime Minister Rishi Sunak on Monday ordered an investigation into a wealthy ally’s murky tax dealing, as he again vowed “integrity” in his government after Mr Boris Johnson’s scandal-plagued tenure.

As well as the probe into Conservative party chairman Nadhim Zahawi, Mr Sunak faced questions about the appointment of BBC chairman Richard Sharp, a former banker who acted as a go-between to help funnel a loan to Mr Johnson when he was in 10 Downing Street.

The allegations surrounding well-off individuals threaten to become a political distraction for Mr Sunak as he battles to restore the Conservatives’ standing in the polls in the midst of

Britain’s worst cost-of-living crisis in decades.

Opposition Labour leader Keir Starmer accused Mr Sunak of extending Mr Johnson’s dismal record of scandal instead of helping people “struggling with their bills, struggling with their jobs, struggling with all of the pressures that come about because of 13 years of (Tory) failure”.

But Mr Sunak refused to accede to opposition demands to fire Mr Zahawi, who reportedly settled a seven-figure demand from tax authorities with a fine for late payment when he served briefly as chancellor of the exchequer last year under Mr Johnson.

The prime minister instead commissioned a probe by his newly appointed ministerial ethics adviser, Mr Laurie Magnus, conceding that “clearly in this case, there are questions that need answering”.

Mr Sunak appointed Mr Zahawi as party chairman, and Cabinet minister without portfolio, when he entered Downing Street in October.

He deflected questions about Mr Zahawi’s activities prior to then, as concerns mounted about whether Mr Johnson knew of the tax investigation when he appointed the Iraqi-born politician as chancellor and head of the UK’s tax authority.

Mr Zahawi welcomed the probe and insisted he did nothing wrong in the tax case, which stems from his co-founding of the successful polling company YouGov in 2000.

But opposition parties have pointed to his shifting explanations as more details have emerged in newspaper reports, and to his prior threats of libel lawsuits against journalists and a tax consultant who had been digging into the affair.

Seatbelt fine

Mr Sunak has faced questions himself about his family’s tax affairs after it emerged that his

Indian wife Akshata Murty

had for years enjoyed “non-domicile” status, which

shielded her from paying UK taxes on her overseas income

from her family’s Infosys business group.

And on Monday, he reiterated apologies for receiving his second police fine, after he was

filmed not wearing a seatbelt in the back seat of a moving car.

As chancellor under Mr Johnson, Mr Sunak was fined along with the then prime minister for attending

an illegal workplace party during a Covid-19 lockdown.

The “partygate” scandal was one of several that brought down Mr Johnson. On entering Number 10 in October, Mr Sunak vowed “integrity, professionalism and accountability at every level of the government”.

He reiterated that pledge on Monday, but was also forced to defend Mr Johnson’s appointment of Mr Sharp to one of Britain’s most high-profile roles as chairman of the BBC.

According to the Sunday Times, just before he became the chairman, Mr Sharp was involved in securing a private credit line for up to £800,000 for the then-PM from Sam Blyth, an old friend of Mr Sharp who is a distant cousin of Mr Johnson.

Downing Street on Monday defended the BBC appointments process as “rigorous”.

But Mr Sunak asked the government’s commissioner for public appointments, Mr William Shawcross, to review the recruitment competition. And Mr Sharp directed the BBC board to investigate his own appointment for potential conflicts of interest.

Mr Johnson, however, said any suggestion of a quid pro quo in Mr Sharp’s appointment was “a load of complete nonsense”.

“This is just another example of the BBC disappearing up its own fundament,” he told Sky News. AFP