With the benefit of some hindsight, it might have been better all around if, having had the offer on her spacious and desirable flat in Hove accepted, the deputy prime minister had set out, in exhaustive detail, how the purchase was being financed, along with all the relevant tax details.
Not much hindsight would have been required to do that, given that Angela Rayner has already weathered a similar real estate-based political storm over capital gains and council tax liabilities related to a previous sale. On that occasion, the intense pressure eventually eased when she was cleared after two police investigations and a review by HM Revenue and Customs. She may not be so fortunate this time.
Such is the size of the financial penalties and the attention drawn to the now-graffitied seafront address, Ms Rayner may have to sell the place.
In the end, the technical question about how much Stamp Duty Land Tax (SDLT) should have been paid will need to be settled for good by a senior inspector of taxes, a process that is already underway. It is, as Ms Rayner pleads, linked to the tax treatment of trusts, and that is exceptionally complicated for a lay person (which includes journalists, as well as politicians) to comprehend, even if they are the housing secretary.
According to the experts, it is all down to an interpretation of the “deeming rule” contained in paragraph 12 of schedule 4ZA in the Finance Act 2003. This is where the law addresses a property held in trust for a person aged 18 or under, as it applies to Ms Rayner’s family. It’s not the first thing that springs to mind when perusing an estate agent’s window.
The political question, however, is more straightforward – and more pressing.
The answer to it lies with the prime minister and the independent adviser on ministerial conduct, Sir Laurie Magnus. Neither Sir Laurie nor Sir Keir Starmer, for that matter, are qualified to adjudicate on the SDLT issue. However, they are the only people entitled to say, definitively, whether Ms Rayner was as fully open and transparent as she should have been, according to the ministerial code, and what, if any, sanction should be applied to her.
In his latest broadcast interview, Sir Keir was reluctant to commit himself to dismissing Ms Rayner if she was indeed to be found by Sir Laurie to have broken the code. This seems evasive, but is probably wise, given that Sir Laurie’s conclusions may well be hedged around with mitigating circumstances.
She may, for example, have been given faulty legal advice by some, or all, of the three lawyers she consulted. She may have failed to accurately describe the nature of her child’s trust and her beneficial relationship to it – deliberately or otherwise. She may have felt constrained by the confidentiality required.
She would certainly have found it an emotionally sensitive subject. Her use of a ministerial flat in London, an unusual circumstance, may also have complicated matters. Sir Laurie’s judgement, in other words, may not be as clear-cut and damning as Opposition politicians are expecting and hoping for. In that case, Sir Keir will have an even more agonising decision to take about his deputy.
One thing that is already clear is that Ms Rayner has had too many property tangles for her to continue in the role of housing secretary; it is a little too close to satire for political comfort.
In any ministerial reshuffle, she should be expected to move, though not necessarily suffer a humiliating demotion. More broadly, her political career and “brand” has clearly been damaged. She often says that she has no ambition to be prime minister – but if she ever had such a dream, it has surely been shattered, at least for the time being (with some future redemption possible depending on how harshly HMRC rules on her behaviour). The recent overheated talk about Sir Keir succumbing to a palace coup led by Ms Rayner will die down, even if the prime minister’s troubles look far from evaporating.
As party conference season opens – with Reform UK gathering in Birmingham – the timing could hardly be worse. Even though Kemi Badenoch missed an open goal as wide as a Hove mansion block during the last session of Prime Minister’s Questions, she and her beleaguered Conservatives will enjoy their moments of revenge, ones perhaps tinged with misogyny and classism.
Ms Rayner was, after all, merciless in pursuing the tax-related problems that beset Nadhim Zahawi and Jeremy Hunt. Nigel Farage will also have some fun, albeit he is less sanctimonious about the acquisition of wealth.
More seriously for the nation, Sir Keir’s revived Labour was supposed to be about professionalism and getting rid of any behaviour that might even be perceived as “sleaze” and below the highest of standards. It was the prime minister himself who said tax evasion was as serious as any kind of fraud. He will be held to those words.
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