NADHIM Zahawi will survive as Conservative Party chairman beyond Wednesday, James Cleverly said as he insisted tax affairs are “private matters”.
But critics said Zahawi’s political survival is “difficult” after he admitted paying a settlement to HM Revenue & Customs following a tax error related to a shareholding in YouGov.
Cleverly stressed Zahawi’s error was “careless” and not deliberate, amid allegations he avoided tax and had to pay it back as part of a seven-figure sum to HMRC.
The embattled Tory chair released a statement on Saturday to “address some of the confusion about my finances”, but it raised further questions, including whether Zahawi negotiated the dispute while he was serving as chancellor.
He did not disclose the size of the settlement – reported to be an estimated £4.8 million including a 30% penalty – or confirm whether he paid a fine.
Cleverly denied any knowledge of the details when pressed during media appearances on Sunday.
“I don’t know more than is in his statement,” he said.
Asked whether Zahawi should reveal this information, the Foreign Secretary said: “People’s taxes are private matters. I know that as politicians we, quite rightly, are expected to have a higher level of disclosure than perhaps other people might do.
“Nadhim has issued a statement where he has admitted that he made a careless error, that this is now resolved.”
Cleverly also evaded questions on what Rishi Sunak knew when he appointed Zahawi as party chairman.
He suggested the Prime Minister does not discuss ministers’ “external affairs” during appointments and that it is the Cabinet Office’s role to conduct due diligence on his behalf.
He said he was unable to answer questions on Zahawi’s tax affairs because he was carrying out his duties as Foreign Secretary during the week and then “having a bit of a rest and doing some shopping”.
Asked whether Zahawi will survive in his role until Prime Minister’s Questions on Wednesday, Cleverly said: “What else am I going to say other than yes, because he’s a very, very effective minister.”
Reports about Zahawi’s tax affairs began emerging when he was appointed chancellor by Johnson last summer.
He denied allegations that he avoided tax by using an offshore company registered in Gibraltar to hold shares in the YouGov polling company he co-founded.
Opposition parties have demanded an independent investigation as well as the publication of all of Zahawi’s correspondence with HMRC.
