PMQs: Rishi Sunak to be pressed over Nadhim Zahawi’s tax affairs

Rishi Sunak is likely to face more criticism at Prime Minister’s Questions as he resists calls to sack his party chairman Nadhim Zahawi.

Mr Sunak has ordered his ethics advisor to investigate how Mr Zahawi resolved a tax dispute when he was chancellor.

The PM has said there are “questions that need answering” but it is unclear what he knew about Mr Zahawi’s dealings with HMRC when he appointed him.

Mr Zahawi maintains he behaved appropriately.

Last summer, Mr Zahawi dismissed reports of a HMRC investigation as “smears” and threatened some who intended to raise questions about his tax affairs with legal action.

This has drawn criticism not just from the opposition, but from Lord Evans, Chairman of the Committee on Standards in Public Life.

He told BBC Radio 4’s PM programme that the “apparent legal attempts to suppress this story” does not “live up to the sort of standards” the public would expect.

Senior Conservative MP Caroline Nokes has called for Mr Zahawi to “stand aside until this matter is all cleared up” but the prime minister has so far stood by him saying it is “longstanding practice” for ministers to remain in their roles while under investigation.

Mr Sunak ordered the investigation into Mr Zahawi’s tax affairs after it was revealed he had paid a penalty to settle his tax issue with HMRC.

The prime minister’s spokesperson suggested Mr Sunak was not aware last week that Mr Zahawi had paid a penalty.

That leaves questions for former Prime Minister Boris Johnson, who appointed Mr Zahawi chancellor last summer when the matter had not been resolved.

In a statement, Mr Zahawi said he welcomed the investigation and looked forward to “explaining the facts of this issue” to the No 10 ethics adviser Sir Laurie Magnus.

Labour has argued the prime minister should sack Mr Zahawi before the investigation concludes, calling it a “pathetic attempt to pass the buck”.

Former Conservative minister David Gauke said Mr Zahawi is likely to have to quit, telling the BBC: “It’s hard to see how this doesn’t ultimately end in his resignation.”

He added there were too many “impossible questions” – and Prime Minister’s Questions would be “very uncomfortable” for Mr Sunak.

Mr Sunak’s spokesman has said Sir Laurie’s inquiry will be carried out “swiftly,” but no timeline has been set for publication of its findings.