Sunak ‘completely out of touch’ on everyday struggles, says Starmer

Keir Starmer has accused Rishi Sunak of “rank hypocrisy” and questioned the ability of super-rich politicians to relate to the public as No 10 came under pressure to reveal if any other ministers had used schemes to avoid tax.

And we still don’t have transparency over the extent of the use of non-dom status and other tax weases amongst cabinet members. – Owl

Jessica Elgot www.theguardian.com 

In an interview with the Guardian amid controversy over Rishi Sunak’s wife’s tax status, Starmer said having a spouse who was a non-dom would create a “very obvious conflict of interest” for any cabinet minister.

He called on the prime minister to make clear that no other cabinet ministers had taken advantage of non-dom status, used tax havens or benefited from offshore trusts.

Sunak has referred himself to the adviser on ministerial interests for an inquiry and his wife, Akshata Murty, last week said she would pay all UK tax on foreign earnings in future. Sajid Javid, the health secretary, also admitted on Sunday to having been a non-dom for six years while a banker, before he was an MP.

But despite the continuing public outcry, No 10 on Monday said it could not reveal whether any other ministers or their spouses held or had previously held non-dom tax status.

Starmer said the chancellor still had “basic” things to answer about how much tax his family had avoided with Murty’s non-dom status, with estimates she legally avoided paying UK taxes of £20m on overseas earnings.

Sunak’s own financial interests are also under scrutiny, as he resisted calls to reveal what assets he has put into a “blind” management arrangement, meaning they can be kept secret from the public.

The Lib Dems on Monday wrote to Kathryn Stone, the parliamentary commissioner for standards, asking her to launch an inquiry into why Sunak had declared no financial interests between 2015 and 2019 as an MP, but then revealed the existence of a blind trust in 2019 when he became a Treasury minister.

Sunak has never revealed his wife’s international interests on his list of ministerial interests, although he does declare her holding in the UK-based Catamaran Ventures. She is known to hold about £690m in shares in Infosys, the Indian IT company founded by her billionaire father.

The Guardian has also established that Murty has held US investments through a trust in her own name, Akshata Narayana Murty Trust, which is revealed in American filings. Her spokesperson had no comment, apart from that “all rules were followed”.

There are also continuing questions around Sunak’s possession of a US green card for permanent residents, including for six years as an MP and government minister. Sunak left his job in the US in 2013, but declared the same year in a UK company filing that he was resident in the UK, suggesting he was giving different information to the British and US authorities about his residency. The US states that green card holders should give up their status if they take up residence elsewhere.

Despite warnings that Sunak may have flouted US immigration rules, the chancellor is understood to be heading to Washington next week for International Monetary Fund spring meetings.

The row over the tax arrangements of Murty, who has said she has maintained her non-dom status in part because she hopes to return to her birth country of India, has reportedly led Sunak to question his future in UK politics.

Asked if there were issues with politicians from a super-wealthy elite becoming prime minister, Starmer said it would be likely to pose problems. “There’s much more likely to be a conflict of interest. I don’t know many people who have signed up to a non-dom scheme in order to increase their tax. It is pretty obvious why people do it.” But he also said there was a “broader issue” about politicians’ disconnection from ordinary people’s lives.

“I think that even before we got to the non-dom issue, the chancellor’s response to the spring statement, to the real pressures on people, showed that he just doesn’t get it.”

Starmer highlighted Sunak’s own personal wealth – his four homes – and his reference to having four different types of bread in his house, as well as his decision to borrow a Sainsbury’s worker’s ordinary car for a photoshoot, as evidence he was “completely out of touch”.

“You know, whether that’s picking up somebody else’s car, whether it’s four loaves of bread in his own family, whether it’s a number of houses, it’s about whether he gets it. It’s about whether you understand, whether you can relate to the very real struggles that people have and the cost of living crisis, and it dominates every discussion we have around the country.”

Starmer has so far refused to commit to Labour’s longstanding policy to abolish non-dom status, first announced by Ed Miliband in 2015, but said the party was undertaking an extensive review of the tax system.

Speaking to the Guardian on a campaign visit to Sunderland, he hinted that he was uncomfortable with the system of overseas tax status. “Most people don’t get that choice … it’s only a very small minority of people. This has been portrayed as some complex tax situation. It’s not.”

Starmer also expressed some hesitation at the idea politicians should publish their own tax returns, saying it was “overcomplicated” and that all proper declarations should be made.

But he added: “There is nothing to reveal in my tax returns, [but] I can tell you if I was prime minister, I wouldn’t be going to the country saying I want more tax from you, but secretly I’m reducing my own tax burden through schemes. It’s rank hypocrisy.”

Starmer said that he had been hearing deeply worrying stories from voters on the campaign trail about the way that rising energy bills and inflation were affecting their lives.

“They are really worried about paying the bills. The most repeated thing said to me, particularly from older people, is that they are not putting the heating on, or sitting in their dressing gown all day, because [they are] too scared to turn up the heating.

“Somebody said to me: ‘I don’t put our central heating up higher than 12 degrees.’ Someone last week said to me in the supermarket: ‘Now, I pick things up and then put them back down again and try to get something cheaper.’”

He said Labour had a message about “practical ways to deal with the problems” and said people were receptive to his party’s message on taxing the extra profits of oil and gas companies to reduce energy bills. “Of course, we’ve got to show that we are the party to be trusted with the economy, but I think we are doing that.”

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