Inquiry into Rishi Sunak’s financial affairs gets thumbs-up from PM

Boris Johnson approved an inquiry into Rishi Sunak's financial affairs, a British government spokeswoman said, adding that the prime minister had offered his "full support" to the chancellor of the exchequer.

Mr Sunak said late on Sunday he had asked Mr Johnson for a review into whether he properly declared his interests. It’s an attempt to draw a line under growing questions about his financial arrangements, after it was revealed that his super-rich wife, Akshata Murthy didn’t pay UK taxes on her overseas earnings and he held a US green card for over a year and a half while chancellor.

“The prime minister is confident that all the appropriate declarations have been followed,” a spokeswoman told reporters. “The prime minister has provided his full support for the chancellor.”

The reports about Mr Sunak and his family have added to the perception he is out of touch with the struggles of ordinary Britons, seriously denting his chances of succeeding Mr Johnson as Conservative Party leader and prime minister. The chancellor’s approval ratings were already plummeting following a mini-budget in April that was criticised even by Tory MPs for failing to do enough to alleviate a snowballing cost-of-living crisis.

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Intense backlash

On Monday, Ipsos published a poll showing that more Britons think he’s doing a bad job at tackling rising living costs than think he’s doing a good one. Facing an intense backlash, Ms Murthy, who holds a stake worth almost $1 billion in Infosys, said on Friday said she would begin to pay UK taxes on her overseas earnings – though she stopped short of renouncing her so-called non-dom tax status, meaning she isn’t required to make the payments.

Mr Sunak also faces questions after the Independent newspaper reported that trusts in the British Virgin Islands and Cayman Islands, set up to manage Ms Murthy’s interests, listed Mr Sunak as a beneficiary as recently as 2020.

Asked by reporters to comment on the report, the Downing Street spokeswoman said: “The chancellor provided a full list of all relevant interests when he first became a minister in 2018, as required under the ministerial code.”

The Labour Party said Mr Johnson should give a public assurance that no one else in his cabinet has reduced their own taxation through any special status or alternative means, even if legal.

Ethics adviser

“What we can’t have is a chancellor who is telling millions of people that they have to pay more tax, there is no alternative, whilst at the same his own family appear to have been using a scheme to keep their own tax down,” Labour leader Keir Starmer told reporters in Sunderland.

The review into Mr Sunak's declarations will be conducted by ethics adviser Christopher Geidt, who previously criticised Mr Johnson over the funding of his Downing Street apartment refurbishment – though the prime minister was ultimately cleared of wrongdoing.

Mr Johnson’s office did not give a timeframe for Mr Geidt to conclude his inquiry.

Mr Sunak’s rapid fall from public favour has coincided with a bounce-back in fortunes for Mr Johnson, who only a couple of months ago was battling for his political survival over allegations of rule-breaking parties in Downing Street during the pandemic. The chancellor was tipped then as the frontrunner to replace Mr Johnson, but now that prospect looks increasingly distant. – Bloomberg