The Chancellor Rishi Sunak’s family has been accused of “sheltering a large part of their income from UK taxes” as it has emerged that his wife holds non-domiciled status.
Sunak’s wife Akshata Murty is estimated to be worth hundreds of millions of pounds and she is not legally entitled to pay tax in the UK.
Murty, the fashion-designer daughter of a billionaire who married Sunak in 2009, insists that she pays taxes on all UK income and said the set-up is required because she is an Indian citizen. However, experts disputed this.
Business Secretary Kwasi Kwarteng defended the Chancellor arrangements as “in order” as he struck out at the scrutiny of her finances saying it is “completely unfair.”,
Labour frontbencher Ed Miliband said that the Chancellors family are “are sheltering a large part of their income from UK taxes.”
Murty confirmed her “non-dom” status after the Independent website reported her arrangements on the day Sunak’s national insurance hike took effect on Wednesday.
Miliband, the shadow climate change secretary, told BBC Breakfast, “The issue here that Rishi Sunak needs to answer – and I think we do need to be cautious about people’s spouses being brought into public domain but I think it is a legitimate question – which is, at a time when people are facing incredibly strained finances and Rishi Sunak is raising taxes, he says to pay for public services, we’ve got his immediate family sheltering a large part of their income from UK taxes.
“I think there is a legitimate public question about whether that is the right decision because he’s the guy asking us to pay more in taxes.”
Kwarteng rejected the allegation as untrue, saying “sheltering sounds as if you’re evading things.”
“I think she’s been very clear, she’s been very transparent, the Chancellor’s been very transparent, and this non-dom status has been part of the UK tax system for more than 200 years,” he told BBC Breakfast.
Asked on BBC Radio 4’s Today programme if Ms Murty is a tax avoider, Mr Kwarteng responded: “I don’t know anything about her tax affairs.
“What I do know is that she has been very clear about the fact she’s an Indian citizen, once she’s lived here for 15-years the non-domiciled status falls away so that will happen in a few years, I don’t know when.
“As far as I’m concerned that’s good enough for me and I think we can move on from that story.”
A spokeswoman for Murty confirmed she holds non-dom status after reports surfaced, she said, “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.”
Professor Richard Murphy, the Sheffield University academic who co-founded the Tax Justice Network, questioned her statement.
“Domicile has nothing to do with a person’s nationality,” he said.
“In other words, the claims made in the statement issued by Ms Murty are wrong, and as evidence, just because a person has Indian citizenship will never automatically grant them non-dom status in the UK.”
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