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Hunt says he has never paid a tax penalty amid growing calls for Zahawi to go

Hunt says he has never paid a tax penalty amid growing calls for Zahawi to go

Chancellor Jeremy Hunt said he has never paid a tax fine, as ministers’ financial affairs come under scrutiny amid growing calls from Conservatives for Nadhim Zahawi to stand down.

Mr Hunt raised suspicions by twice refusing to say whether he has paid a penalty as he took questions after an economic speech, claiming the public are not “remotely interested” in the subject.

But then he went on to tell broadcasters in an interview a short while later on Friday that “for the record I haven’t paid an HMRC fine”.

He was responding to questions amid growing calls for Mr Zahawi to step aside as Conservative Party chairman while under investigation for settling a multimillion-pound tax dispute while chancellor.

Mr Zahawi has authorised HM Revenue and Customs to discuss his settlement – estimated to be worth £4.8 million and include a penalty – with the investigation ordered by Rishi Sunak.

Pressure on ministers only grew after HMRC boss Jim Harra told MPs there are “no penalties for innocent errors in your tax affairs”.

Under questioning after a Bloomberg speech inn London, Mr Hunt said: “I’m not going to talk about my personal tax affairs, but I don’t think there’s anything you’d find interesting to write about if I can put it that way.”

He declined to answer when pressed again and added: “By the way, I don’t think people at home are remotely interested in personal tax affairs, they are interested in these things,” gesturing towards the Government’s five priorities.

But a little while later he dropped his opposition to answering the question.

“I don’t normally comment about my own tax records, but I am Chancellor so for the record I haven’t paid an HMRC fine,” he told broadcasters.

Similar confusion occurred on Wednesday after Downing Street initially refused to say whether Rishi Sunak had paid a penalty, saying his tax affairs are “confidential”.

Hours later, No 10 released a statement saying: “The Prime Minister has never paid a penalty to HMRC.”

Senior Tory MP Sir Jake Berry has said it is “unsustainable” for Mr Zahawi to remain in power, arguing it was necessary to step aside while under investigation so the public can have faith in the process.

Conservative Party Conference 2022
Tory MP Sir Jake Berry said it is ‘unsustainable’ for Mr Zahawi to remain in position (Aaron Chown/PA)

The former minister, who was Mr Zahawi’s direct predecessor as party chairman, told BBC Question Time: “Even though he is a friend of mine, I’m not going to allow that to distract from a view I’ve put forward consistently.

“The Government needs to find a mechanism for ministers and MPs who are under investigation in this way to step aside, to clear their name, and then to come back into government if that is appropriate.

“I think from Nadhim, great individual that he is, that would be the right thing to do now.

“I do think it’s unsustainable for a minister to stay in this post while this investigation goes on.”

Mr Sunak has refused calls from Labour and other senior Tories including Caroline Nokes to remove Mr Zahawi from his post either permanently or temporarily.

Former chancellor Philip Hammond said on Friday that he would not have felt able to take on the role if he had been engaged in a dispute with HMRC.

Lord Hammond told Times Radio: “I would not have felt able and would not feel able now, not that anyone’s likely to offer it to me, to accept the office of Chancellor, if I was currently engaged in a tax dispute with HMRC. That just isn’t right.

“It’s just about common sense. And what feels right. And that doesn’t feel right to me.”

On Thursday, a source close to Mr Zahawi said he would permit HMRC to share details of his case with ministerial standards adviser Sir Laurie Magnus.

The revelation came after Mr Harra told the Public Accounts Committee the department could only co-operate with the investigation if given approval by Mr Zahawi.

“There are no penalties for innocent errors in your tax affairs,” the HMRC chief executive added.

The Guardian reported that Mr Zahawi’s penalty stood at 30% of the settlement, which he dealt with while Chancellor.

Mr Sunak maintained his position on Thursday that he will “await the findings” of the investigation into whether Mr Zahawi broke the ministerial code.

Nadhim Zahawi
Conservative Party chairman Nadhim Zahawi (Victoria Jones/PA)

Speaking during a Cabinet away day at Chequers, the Prime Minister told broadcasters: “I’m not going to pre-judge the outcome of the investigation, it’s important that the independent adviser is able to do his work.

“That’s what he’s currently doing, that’s what I’ve asked him to do and I’ll await the findings of that investigation.”

A week ago, Mr Sunak told Prime Minister’s Questions that Mr Zahawi had addressed the fiasco “in full”.

But he went on to launch an investigation by Sir Laurie, his independent adviser on ministers’ interests, admitting there were “questions that need answering” after the penalty was revealed.

Mr Sunak insisted that “no issues were raised with me” when he appointed Mr Zahawi to his current role, amid questions over his political judgment.