Thursday, April 07, 2022
Tory leadership contest well-underway
Rishi Sunak may well argue that his wife's activities shuld have no bearing on people's opinion of him, but unfortunately in the world of politics, especially at his level, it is the full package that matters. That is especially so when the Chancellor's partner is such a controversial figure in her own right.
The Tory leadership contest is in full-swing and Sunak's rivals will use everything they can to undermine his credibility as a future Prime Minister, and it certainly looks like they have succeeded. With everybody struggling to make ends meet in the face of rising prices, soaring energy costs and additional taxes, it does not look good that the man responsible for most of this is married to a multi-millionaire, who does not pay tax in the UK on her overseas earnings.
The Guardian reports that Sunak’s multi-millionaire wife's non-domicile status allows her to save millions of pounds in tax on dividends collected from her family’s IT business empire. Akshata Murthy, who receives about £11.5m in annual dividends from her stake in the Indian IT services company Infosys, declares non-dom status, a scheme that allows people to avoid tax on foreign earnings:
Murthy, the daughter of Infosys’s billionaire founder, owns a 0.93% stake in the tech firm worth approximately £690m. The company’s most recent accounts suggest that Murthy’s stake would have yielded her £11.6m in dividend payments in the last tax year.
Under UK tax laws, Murthy’s status as a non-dom would mean she would not have had to pay tax on the dividend payment from overseas companies. Infosys is headquartered in Bengaluru, India, and listed on the Indian and New York stock exchange. By contrast, UK resident taxpayers pay a 38.1% tax on dividend payouts.
All of this matters, because in his Spring Statement last month, Sunak raised the tax burden on UK taxpayers to its highest level since the 1940s, even as the population faces the biggest squeeze on living standards on record. The Resolution Foundation thinktank suggested Sunak’s package of measures would push 1.3 million people, including 500,000 children, into poverty.
Any chance Sunak had of succeeding Boris Johson appears to have evaporated.
The Tory leadership contest is in full-swing and Sunak's rivals will use everything they can to undermine his credibility as a future Prime Minister, and it certainly looks like they have succeeded. With everybody struggling to make ends meet in the face of rising prices, soaring energy costs and additional taxes, it does not look good that the man responsible for most of this is married to a multi-millionaire, who does not pay tax in the UK on her overseas earnings.
The Guardian reports that Sunak’s multi-millionaire wife's non-domicile status allows her to save millions of pounds in tax on dividends collected from her family’s IT business empire. Akshata Murthy, who receives about £11.5m in annual dividends from her stake in the Indian IT services company Infosys, declares non-dom status, a scheme that allows people to avoid tax on foreign earnings:
Murthy, the daughter of Infosys’s billionaire founder, owns a 0.93% stake in the tech firm worth approximately £690m. The company’s most recent accounts suggest that Murthy’s stake would have yielded her £11.6m in dividend payments in the last tax year.
Under UK tax laws, Murthy’s status as a non-dom would mean she would not have had to pay tax on the dividend payment from overseas companies. Infosys is headquartered in Bengaluru, India, and listed on the Indian and New York stock exchange. By contrast, UK resident taxpayers pay a 38.1% tax on dividend payouts.
All of this matters, because in his Spring Statement last month, Sunak raised the tax burden on UK taxpayers to its highest level since the 1940s, even as the population faces the biggest squeeze on living standards on record. The Resolution Foundation thinktank suggested Sunak’s package of measures would push 1.3 million people, including 500,000 children, into poverty.
Any chance Sunak had of succeeding Boris Johson appears to have evaporated.
