Health secretary Sajid Javid claimed non-domicile tax status for six years when he was a banker, it has been reported.
Mr Javid admitted to The Times that he had been a ‘non-dom’ between 2000 and 2006, when he was working for Deutsche Bank.
The cabinet minister said he had qualified for the scheme, which allows someone to not pay UK tax on their overseas earnings, because his father was born in Pakistan.
The revelation comes after The Independent revealed that the chancellor Rishi Sunak’s wife avoided UK tax on her overseas income through her non-dom status.
The health secretary also revealed that he had also benefited from an offshore trust during his time in the financial sector.
Mr Javid said: “I have been domiciled in the UK for tax purposes throughout my entire public life. Given heightened public interest in these issues, I want to be open about my past tax statuses.”
He addedd: “My career before politics was in international finance. For almost two decades I constantly travelled around the world for work.”
He said that after a posting in New York he returned to the UK, and “for some of those years, I was non-domiciled for tax purposes, but I paid all UK taxes due on my income and have always done so.”
Referring to the offshore trust, he said: “Prior to returning to the UK and entering public life, some of my financial investments were based in an offshore trust.”
He said “this was an entirely legitimate arrangement”, adding: “On becoming a minister in 2012 I decided to voluntarily collapse that trust, repatriate all assets to the UK and pay 50 per cent income tax on those assets.”
Mr Javid added: “This approach deliberately incurred the heaviest possible tax burden, and offset any accrued benefits from the previous trust arrangement, but I believed it was the right thing to do.”
Labour accused Mr Javid of “hypocrisy” after the minister has said Britons had a “moral duty” to pay the levy to fund the NHS and social care.
“Last week Sajid Javid lectured struggling taxpayers about their duty to pay higher taxes,” said Wes Streeting, shadow health secretary.
“But this is the guy who spent six years as a non-dom and had an offshore trust to avoid paying his fair share. The luxury of being able to choose how much tax you pay, where you pay it, and when you pay it, is not one that is enjoyed by most people in this country.”
The Labour frontbencher added: “Even now, he refuses to say if he was using a tax haven. The hypocrisy stinks.”
But Home Office minister Kit Malthouse defended Mr Javid on Sunday – saying his arrangements dated back to a time he had worked overseas before he became a MP.
“He worked overseas, he worked in international banking. As I understand it, these [arrangements] were from a time before he became elected – I know hard it is to believe, some of us did have a life before we were elected.”
Mr Malthouse also sought to defend Mr Sunak, saying he has been a “remarkable force for good”. Asked if the chancellor was now political “toast”, the minister replied: “No, I don’t believe that.”
Opposition parties and campaigners have also called on the chancellor to disclose his links to Britain’s overseas territories after The Independent revealed claims that he was listed as a beneficiary of tax haven trusts.
Labour has called on him to urgently clarify whether he helped “shape” tax rules through the recent Finance Act 2022 to benefit wealthy investors with non-domicile status.
Yvette Cooper, shadow home secretary, said there may have been a conflict of interest between Mr Sunak’s role as chancellor and his wife tax status.
“So we don’t know for example, whether the chancellor declared a conflict of interest when he was making decisions on policies, there are some policies reported that do affect non-dom people with non-dom status,” she told Sky News.
Labour MSP Paul Sweeney questioned why Sunak thought his wife’s finances were “off limits” – tweeting: “When I applied for Universal Credit I was asked questions about the income of everyone in my household.”
