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Nadhim Zahawi’s Tax Affairs
By Samhita S
Conservative party’s chairman, Nadhim Zahawi, is coming under political pressure to explain his five million pound tax settlement. The tax bill originated from his shares in YouGov, a polling company that he co-founded in 2000, before he was an MP.
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Usually, residents of the UK are taxed based on profits from the sale of shares in a certain company. However, YouGov allocated 42.5% of its shares to Balshore Investments, which was described in YouGov’s 2009 annual report as a “family trust of Nadhim Zahawi”. Zahawi claimed that his father also took founder shares in YouGov “in exchange for some capital and his invaluable guidance”. So, when YouGov became successful, Balshore sold its shares, that were estimated in 2018 to be worth £27M. However, Mr Zahawi has denied any involvement with Balshore. How? Or rather, why?
On the 9th July 2022, the Independent reported that HMRC (tax authorities) experts were investigating Mr Zahawi’s tax affairs. A day later, the Observer reported that a “flag” has been raised by officials about the same. However, Mr Zahawi claimed that “I was clearly being smeared”, and that the tax issue was settled before his appointment as chairman.
But this is where Mr Sunak gets involved. His opinions on the matter went from fully trusting Mr Zahawi to asking “the independent adviser to look into the matter” in mere days. He says this is due to new information coming forward. Sir Keir Starmer, however, has other thoughts. He comments that the PM’s “failure” to sack Mr Zahawi showed “how hopelessly weak he is – a prime minister overseeing chaos, overwhelmed at every turn.” Then, he took it a bit further.
“He can’t say when ambulances will get to heart attack victims again. He can’t say when the prison system will keep streets safe again. He can’t even deal with tax avoiders in his own cabinet. Is he starting to wonder if this job is just too big for him?” Mr Sunak, in retaliation, said it was Sir Keir who was weak because “he has no principles just petty politics”.
So, has the chairman’s financial matter turned into a catfight between the Prime Minister and the Leader of the Opposition?
