Sunak Criticised for Releasing Tax Documents During Partygate Grilling

Prime Minister Rishi Sunak departs 10 Downing Street to attend Prime Minister's Questions at the Houses of Parliament, in London, on March 22, 2023. (Victoria Jones/PA Media)

British Prime Minister Rishi Sunak has been criticised for releasing long-awaited tax documents during his predecessor Boris Johnson’s partygate grilling.

MPs questioned why Sunak—who made almost £2 million through income and capital gains in one year—chose to publish his tax affairs on Wednesday, one of the busiest news days in Westminster.

On top of Johnson’s five-hour-long questioning by the Privileges Committee on whether he misled the House of Commons on COVID-19 breaches in Downing Street, MPs also voted on Sunak’s new deal on post-Brexit trading arrangements for Northern Ireland on the same day.

The timing raised some eyebrows, with Labour MP Angela Rayner questioning on Twitter why the millionaire prime minister chose Wednesday afternoon to release the tax summary.

Liberal Democrat Cabinet Office spokeswoman Christine Jardine also said she didn’t understand why Sunak “snuck them out” with distraction around Johnson’s questioning.

Boris Johnson giving evidence to the Privileges Committee at the House of Commons, London, on March 22, 2023. (House of Commons/UK Parliament via PA Media)

Sunak promised during the Tory leadership campaign last July that he would publish his tax affairs if he became party leader and prime minister.

Although not a full tax return, the summary—released by Downing Street—shows he paid £432,493 in tax in the 2021/2022 financial year, £393,217 in 2020/2021, and £227,350 in 2019/20.

The former California resident separately paid $6,892 from $45,948 of dividends that were taxed separately in the United States in 2021.

Sunak made nearly £2 million through income and capital gains in 2021/22.

He received £172,415 in dividends and £1.6 million in capital gains.

Most of that related to an American-based investment fund listed as a blind trust, according to the summary.

His total investment income that year was more than double his MP’s salary of £81,908.

‘Transparency’

During a visit to RAF Valley in Anglesey, North Wales, on Wednesday evening, Sunak was asked whether he understands what it is like for people struggling to pay their bills during the cost-of-living crisis.

The prime minister replied: “Well, I’ve published my tax returns because I said I would in the interests of transparency and I’m glad to have done that.

“Now, I think ultimately what people are interested in is what I’m going to do for them.

“You know, you talk about the cost of living and, of course, that’s the number one priority that I’ve got that I’m grappling with.”

Prime Minister Rishi Sunak during a visit to RAF Valley in Anglesey, North Wales, on March 22, 2023. (PA)

Commenting on Sunak’s tax affairs, Conservative Party Chairman Greg Hands told ITV, “I think we should be proud of the fact that people are paying tax in this country and proud of the fact they’re financing our excellent public services.”

Hands also told Sky that the prime minister “comes from a relatively modest background” and that his parents “saved up a lot of money” to send him to the private school Winchester College.

However, Labour backbench MP Richard Burgon criticised the savings made by Sunak through what he called a “tax advantage.”

He wrote on Twitter: “The PM is saving huge sums through a tax advantage where capital gains are taxed at lower rates than income.

“I’ve been campaigning to equalise these rates, which would raise £17 billion per year.

“No wonder the PM refuses to do it.”

Rishi Sunak, then-chancellor of the Exchequer, and his wife Akshata Murty attend a reception to celebrate the British Asian Trust at the British Museum, in London, on Feb. 9, 2022. (Ian West/PA Media)

Sunak faced continued pressure to release the documents in recent months when it emerged that Tory former minister Nadhim Zahawi settled an estimated £4.7 million bill with HMRC while he was chancellor.

The prime minister’s family finances previously faced scrutiny while he was chancellor when the “non-dom” status of his wife Akshata Murty was revealed.

The arrangement reportedly saved her millions in UK income taxes.

Following the controversy, Murty, an Indian billionaire’s daughter who married Sunak in 2009, declared that she would pay UK taxes on all her worldwide income.

Questions were also raised when it emerged that Sunak had retained a U.S. green card for some time while he was chancellor, entitling him to permanent residence in America.

With spells at investment bank Goldman Sachs and as a hedge fund manager, Sunak was already independently wealthy when he entered politics in his early 30s.

Lower Tax Rate

Dan Neidle, a tax lawyer whose work helping to expose Zahawi’s tax affairs resulted in the former Conservative Party chairman’s resignation, said Sunak’s effective rate of tax was far lower than if the majority of those earnings had been made via employment.

He told Sky News: “It is because in this country we tax employment income at up to 47 percent but capital gains on investments at only 20 percent. That is why his effective rate is so low.”

While prime ministers are not required to make their tax affairs public, former Prime Minister David Cameron also released details of his in 2016 after coming under pressure to do so.

Following the move, Labour leader Sir Keir Starmer said he would also aim to publish his tax return.

Answering questions after giving a speech in Stoke-on-Trent on Thursday, the Starmer said: “Now the prime minister has published his, I will publish mine.

“I hope to be able to do that later on today, so that’s very straightforward.”

PA Media contributed to this report.