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Rishi Sunak has sacked Nadhim Zahawi as Conservative party chairman over a “serious breach” of the ministerial code, after The Independent first revealed details of an HMRC investigation.
The prime minister said on Sunday that his ethics adviser Sir Laurie Magnus had found Mr Zahawi had broken the ministerial rules around disclosure of the tax probe.
In a letter to Mr Zahawi, Mr Sunak wrote: “Following the completion of the independent adviser’s investigation – the findings of which he has shared with us both – it is clear that there has been a serious breach of the ministerial code.”
The PM added: “As a result, I have informed you of my decision to remove you from your position in His Majesty’s Government.”
It emerged earlier this month that Mr Zahawi had paid a £1m penalty as part of a £5m tax settlement, prompting pressure Tory MPs for the senior figure to quit and end the “distraction” his tax saga.
The Independent first revealed in July 2022 that HMRC was investigating Mr Zahawi’s taxes in relation to an offshore company Balshore Investments, which had held shares in the polling company he co-founded, YouGov.
Mr Zahawi had intially dismissed the story as “smears” and threatened The Independent and others asking questions about his tax affairs with legal action.
But last Saturday, the under-pressure minister admitted that HMRC had found he had made an “error” that was “careless and not deliberate” and he co-operated throughout their inquiries.
In his own letter to the PM, Sir Laurie Magnus told Mr Sunak that certain “omissions” by Mr Zahawi fell short of the standards set out in the ministerial code.
He said the cabinet minister had “shown insufficient regard” for the code – and the requirements under the seven principles of public life – to be “honest, open and an exemplary leader through his own behaviour”.
In his own letter to the PM, Sir Laurie Magnus told Mr Sunak that certain “omissions” by Mr Zahawi fell short of the standards set out in the ministerial code.
He said the cabinet minister had “shown insufficient regard” for the code – and the requirements under the seven principles of public life – to be “honest, open and an exemplary leader through his own behaviour”.
Sir Laurie said the HMRC investigation had started even before Mr Zahawi was appointed education secretary in September 2021.
By failing to declare the tax issues before his appointment as chancellor in July 2022 – despite the ministerial declaration of interests form including specific prompts on tax affairs and disputes – Mr Zahawi “failed to meet the requirement to declare any interests which might be thought to give rise to a conflict”, said the adviser.
Mr Zahawi has not yet disclosed the size of the HMRC settlement, which reportedly amounted to £4.8m, including interest and a 30 per cent penalty of around £1m. His spokesman has not denied the sums.
More follows…
