Nadhim Zahawi faced initial Tory calls for his resignation after admitting that “mistakes” in his tax affairs were deemed “careless” by HMRC.
A former Cabinet minister said the Tory chief’s position had become “untenable” after a former party leader, Sir Iain Duncan Smith, called on him to reveal all the details of his tax affairs.
When asked if he trusts himself as party leader, Secretary of State James Cleverley refused to support Zahawi, saying it was a decision that only the Prime Minister would make.
Number 10 tried to distract Rishi Sunak from the debate, saying Cabinet Office officials said last October that there was nothing to stop the Prime Minister from appointing him as Tory head. By then, Mr. Zahawi’s dispute with HMRC had been resolved.
Zahawi confirmed on Saturday that he has reached a multi-million pound settlement with HMRC over the tax dispute involving YouGov, the survey company he founded.
In his statement, he implied that he had been asked to pay the fine, noting that HMRC had concluded that he had made a “careless and unintentional” mistake. He stated that the deal was made while he was chancellor.
Since last summer, Mr. Zahawi has been facing questions as to why YouGov’s shares are held in Balshore Investments, a family trust registered in Gibraltar.
Speaking on Saturday, the former Tory Cabinet minister said he believes Mr. Zahawi’s position is “frankly untenable”, adding: “I really do believe it because he said he was being careless. That’s a lot of money to ignore.
“Given the president has overall responsibility for the Conservative Party and the Conservative Party treasurer is accountable to him, I honestly don’t think it’s easy to see how he can continue in that role.
“Because it’s such a huge amount of money to be careless, I think it’s impossible for it to continue, and I’m sure a lot of other people feel the same way.”
Sir Iain said in an interview with the BBC’s Laura Kuenssberg on Sunday: “I’ve always been of the view that with this kind of thing, the sooner you get the facts out the better, rather than the real facts coming out gradually.”
“It’s a strange British success story in a way because he, the person who came to the country from Iraq, managed to build a global brand, so all this is in a way remarkable and says a lot about the UK. and diversity and everything else.
“But if he were here, I’d tell him whatever you need to do, just get it out now and clean it up. I really don’t believe this is a cheating guy in any way or form. But this goes on and on and the media is waiting. So I guess I’ll make that clear.”
‘A more comprehensive explanation is needed’
Another former Cabinet minister said: “He needs to give a more comprehensive account of what happened and then I think it would be easier to judge his stance. There are gaps and we definitely need to know the truth.
“At the moment you can’t decide whether this is a layoff offense or pushing the boat too far. If I knew the facts, it would be much easier for people like me to go public in defense of him.”
Speaking on Times Radio, Conservative MP for Waveney Peter Aldous questioned whether anyone in conflict with HMRC “should ever be appointed Chancellor.”
When asked by Camilla Tominey, associate editor of The Telegraph at GB News, if she trusts Mr Zahawi, Mr Cleverley said: “I am not going to start acting as Prime Minister.”
He said he believed tax affairs should be “private matters”, but that accepted politicians should be subject to greater scrutiny from the public, adding that he believes Mr. Zahawi will survive in his role.