HMRC is facing pressure to reveal whether Nadhim Zahawi paid a penalty to the tax office after he reportedly agreed to hand over millions of pounds.
Labour has written to the government department arguing the “public requires answers” over the Tory chairman’s tax affairs.
Questions have swirled following an article in The Sun on Sunday, which claimed a seven-figure payment was made by Mr Zahawi to end a dispute with the taxman “after scrutiny of his family’s financial affairs”.
The paper alleged there were questions over his use of an offshore company – a Gibraltar-registered family trust called Balshore Investments – to hold shares in the polling firm YouGov.
Sky News has made a number of approaches to the Tory MP and his team to clarify the situation around the payment to HMRC, but he has still not revealed if the report is accurate.
Labour has already suggested that an inquiry might be required to look into the matter and the party has now submitted a series of questions to HMRC seeking clarity over the allegations.
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HMRC has said it does not comment on individual cases, but Labour deputy leader Angela Rayner said “given the public interest in this case as well as the serious questions raised about a potential conflict of interest at the heart of government, the public requires answers”.
“In particular, there appears to be an element of special treatment directed towards Nadhim Zahawi by HMRC,” she claimed.
Ms Rayner called on HMRC to explain the nature of the payment and whether the former chancellor “has admitted fault or incurred financial penalties as part of his settlement”.
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A spokesman for Mr Zahawi has said his taxes are “properly declared” and he “has never had to instruct any lawyers to deal with HMRC on his behalf”.
“As he has previously stated, Mr Zahawi’s taxes are properly declared and paid in the UK,” the spokesman said.
Rishi Sunak defended his colleague at Prime Minister’s Questions (PMQs) on Wednesday, saying Mr Zahawi “has already addressed this matter in full and there’s nothing more that I can add”.
But Ms Rayner said: “However much the prime minister claims the man he appointed Conservative Party Chair has already addressed this matter in full, there are serious and urgent questions that must be answered.”
