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Zahawi ditched by Rishi Sunak as Conservative chair over £5m tax bill

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Nadhim Zawahi was sacked as Conservative party chair on Sunday after weeks of speculation about his tax affairs.

Nadhim Zahawi has today been sacked by Prime Minister Rishi Sunak as Conservative party chair after weeks of speculation about his tax affairs. 

Sunak told Zahawi, 55, that, after an independent investigation, “it is clear that there has been a serious breach of the Ministerial Code,” forcing him to ditch the MP for Stratford-on-Avon.

Sunak’s letter said he wanted his government to “have integrity, professionalism and accountability at every level,” a promise he made when entering Number 10 late last year.

Zahawi should be “extremely proud” of his “wide-ranging achievements’”, Sunak wrote, in particular of his stweardship of the Covid-19 vaccine rollout.

The former chancellor has been in the spotlight for weeks over an estimated £4.8m bill he settled with the taxman while chancellor. The bill related to the sale of shares in YouGov, the polling business founded by Zahawi in 2000.

The probe into the former chancellor’s tax affairs was carried out by Sir Laurie Magnus, the government’s ethics adviser.

In a statement released today, Zahawi noted he took pride in two achievements in particular: the vaccine rollout and his role in mourning Elizabeth II as Chancellor of the Duchy of Lancaster. 

However, Zahawi took aim at parts of the media for their coverage. “In a week when a Member of Parliament was physically assaulted, I fail to see how one headline on this issue ‘The Noose Tightens’ reflects legitimate scrutiny of public officials,” he wrote.

Sunak had previously resisted calls to sack Zahawi, but changed his mind after Zahawi issued a statement on 14 January in which he described it as a “careless but not deliberate” error. 

The HMRC investigation into Zahawi began in April 2021. When appointed chancellor by Boris Johnson in July 2022, Zahawi failed to declare the probe, which had been going on for over a year by that point. 

Zahawi also did not disclose the fact he had paid a penalty for tax avoidance when appointed to Liz Truss’s cabinet last September. 

He had reached a settlement with HMRC in August 2022 but it was not until 20 January this year that the details came to light.

Both of these were serious breaches of the ministerial code. 

HMRC has also come under attack for mistakenly saying no ministers were under investigation last summer in response to a freedom of information request. Zahawi was under investigation at the time.