UK politics: Labour demands transparency from Sunak over wife’s finances

Britain's Labour Party has demanded full transparency from chancellor of the exchequer Rishi Sunak over his wife's finances after she confirmed that she does not pay British tax on her foreign earnings. Akshata Murty owns almost 1 per cent of the technology company Infosys, which was founded by her father, a stake believed to be worth hundreds of millions of pounds.

Her spokeswoman confirmed that Ms Murty pays £30,000 (€36,000) a year for non-domiciled tax status, which allows her to avoid paying British tax on dividend payments earned abroad. The spokeswoman declined to say where Ms Murty paid tax or whether she took advantage of overseas tax havens.

"Akshata Murty is a citizen of India, the country of her birth and parents' home. India does not allow its citizens to hold the citizenship of another country simultaneously. So, according to British law, Ms Murty is treated as non-domiciled for UK tax purposes. She has always and will continue to pay UK taxes on all her UK income," she said.

The news about Ms Murty's tax status came as Mr Sunak's increase in national insurance contributions came into effect, hiking the tax burden on most British taxpayers. Labour leader Keir Starmer said that after repeatedly raising taxes, the chancellor had "very, very serious questions to answer" about his wife's arrangements.

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“He says all of this is necessary, there’s no option. If it now transpires that his wife has been using schemes to reduce her own tax, then I’m afraid that is breathtaking hypocrisy,” he said.

“We need complete transparency on this, so that we can all understand what schemes she may have been using to reduce her own tax.”

Non-domiciled

Boris Johnson declined to answer questions about the issue, saying it was important in politics "to keep people's families out of it".

People can qualify for non-domiciled tax status, which was introduced in 1799, if they live in Britain but they plan to return to their permanent home in another country. There is no limit on the number of days they can spend in Britain each year but the status automatically ends after 15 years.

Opposition politicians made clear they were not accusing the chancellor or his wife of doing anything unlawful but Liberal Democrat treasury spokeswoman Christine Jardine said that was not the only question that mattered.

“Government ministers have a duty to do what’s morally right. When they change people’s taxes, they and their immediate families should play by the same rules as everybody else,” she said.

“Rishi Sunak must put what’s right above his own personal and selfish interests. He must take immediate action to close this loophole which leaves the door open for government ministers to exploit non-dom arrangements. And he must come clean on his family’s tax affairs while he’s at it. It would be a scandal if his household were to have benefitted from overseas tax havens.”