Tax-row Tory Nadhim Zahawi has clung to his job as the Prime Minister was urged to “grow a backbone and sack him”.
The Conservative Party chairman remained in post even after it emerged he had failed to tell Rishi Sunak that while he was Chancellor he was given a payment penalty by HMRC.
In a bid to defuse the latest Tory sleaze scandal, the PM admitted there are “questions that need answering” and ordered an ethics probe.
But Labour said he should not need an ethics adviser to tell him Mr Zahawi should be sacked – and Mr Sunak faced calls to finally deliver on his promise to publish his own tax return.
While running the Treasury last summer, former businessman Mr Zahawi paid a settlement, thought to have been around £5million, to the taxman to end a dispute over his bill, including a reported penalty for not paying the right amount to start with.
Labour’s deputy leader Angela Rayner said it was “pathetic” and “simply not good enough” for Mr Sunak to “pass the buck” to his new ethics chief, Sir Laurie Magnus.
She said: “ Nadhim Zahawi was Chancellor while he hadn’t paid his tax and was negotiating a settlement with HMRC at the time.
“You don’t need an ethics adviser to tell you that’s unacceptable.”
And Labour Party chair Anneliese Dodds added: “Rishi Sunak shouldn’t need an investigation to know that Nadhim Zahawi isn’t fit for government. He needs to grow a backbone and sack him.”
She also challenged the PM to deliver on the promise he made after entering Downing Street that he would release details of his own tax affairs.
Ms Dodds told the Mirror: “Rishi Sunak promised honesty, integrity and accountability on entering No10.
“People will be concerned if they feel that the Prime Minister is delaying publishing his own tax return, as he promised. He needs to abide by his promises and publish his own tax returns for 2021/22 and 2022/23. If these promises are not kept, the public’s faith in politicians, already significantly tarnished, will only be further damaged.”
Mr Sunak made his tax pledge while he attended the G20 summit in Bali in November. Asked by the Mirror if he was willing to publish his full tax return, he said: “Yes, of course.
“That is the established precedent and I’d be very happy to follow the precedent. In terms of timing, I will have to speak to the Cabinet Office and figure out the right way that happens. But, yeah, I have no problem doing that.”
Mr Sunak’s spokesman last night said a summary of his tax return would be published “fairly shortly”.
The PM yesterday insisted “integrity and accountability is really important to me” as he instructed Sir Laurie to “get to the bottom of everything” in the row over Mr Zahawi.
Mr Sunak’s decision to draft in the ethics chief came just days after he attempted to shut down questions about the matter during Prime Minister’s Questions last Wednesday by insisting the Tory chair had “already addressed the matter in full”.
Downing Street last night insisted the PM had not been aware at the time of PMQs that Mr Zahawi had paid a penalty to HMRC.
Tory peer and polling expert Lord Robert Hayward told LBC that Mr Zahawi should leave his position “vacant” until the investigation concludes.
Saying he should “stand to one side and allow the official process to be expedited”, he added: “If he feels he should go, then so be it.”
A snap poll of 2,505 adults by Find Out Now showed 59% believe Mr Zahawi should be sacked with only 14% thinking he should not.
The row is the latest case of a senior Tory facing financial scrutiny.
In 2016, David Cameron released a summary of his tax returns from 2009 to 2015 in an attempt to defuse a row over his personal finances.
A few months later, Theresa May published a tax summary during the Conservative Party’s leadership contest but she refused to do so during her time in No10.
And Boris Johnson released his tax details when he was Mayor of London but not when he was PM.
Mr Sunak is the wealthiest leader in Britain’s history, sharing a £730million fortune with wife Akshata Murty.
He faced a backlash last year while Chancellor after it emerged his wife was a non-dom – someone who lives in the UK but declares their permanent home to be in another country, meaning that she did not have to pay UK taxes on her overseas income.
It is estimated this would have saved her £2.1m a year in UK tax.
After details of her non-dom status appeared in the press, Mr Sunak initially said she had not “done anything wrong” and it was unfair to attack her as a “private citizen”.
But after days of negative headlines, Ms Murty announced she would pay UK taxes on her overseas income.
