A sleaze scandal rattled Boris Johnson’s ruling Conservatives as he tried to pull off a political triumph at the Cop26 climate summit in Glasgow. Photo: AFP
A sleaze scandal rattled Boris Johnson’s ruling Conservatives as he tried to pull off a political triumph at the Cop26 climate summit in Glasgow. Photo: AFP
A sleaze scandal rattled Boris Johnson’s ruling Conservatives as he tried to pull off a political triumph at the Cop26 climate summit in Glasgow. Photo: AFP
A sleaze scandal rattled Boris Johnson’s ruling Conservatives as he tried to pull off a political triumph at the Cop26 climate summit in Glasgow. Photo: AFP

Boris Johnson under pressure as opposition seeks ethics probe


Tim Stickings
  • English
  • Arabic

UK Prime Minister Boris Johnson is facing calls for two separate ethics inquiries as his opponents try to capitalise on a sleaze scandal that has tarnished his government’s image.

The opposition Labour Party said Mr Johnson had broken parliamentary rules by failing to declare details of a luxury holiday in Spain last month and the refurbishment of his Downing Street flat.

It accused him of trying to use an inquiry into one of his MPs, Owen Paterson, to sabotage the ethics watchdog that would carry out such an investigation.

Mr Johnson’s Conservatives moved to reform the watchdog rather than accept its recommendation that Mr Paterson be suspended for 30 days.

But they backed down amid a huge political backlash, and Mr Paterson subsequently resigned as an MP.

The scandal was an unwelcome distraction for Mr Johnson as his government appeals for moral leadership from the world during the Cop26 summit.

Speaking on Saturday, one of Mr Johnson's predecessors, Sir John Major, said the government's behaviour was shameful and had damaged the reputation of Parliament.

"Sleaze is unacceptable, was unacceptable when I was there, and I suffered a great deal of pain and anguish over it," Mr Major, whose time in office was marred by ministerial scandals, told BBC radio.

"It's unacceptable today, and it needs to be stopped."

Angela Rayner, the deputy Labour leader, called for the standards commissioner to open two investigations into Mr Johnson.

“Boris Johnson’s attempt to make Conservative MPs judge and jury over allegations of corruption and rule-breaking was a blatant attempt to prevent the commissioner from investigating his latest breaches of the rules,” she said.

Last month, Mr Johnson stayed at a holiday home in Spain owned by Zac Goldsmith, a Conservative former minister.

This was declared in a list of ministerial donations but not entered on the parliamentary register of interests.

“It can’t be one rule for Boris Johnson and another for the rest of us,” said Ms Rayner as she called for an inquiry into the holiday.

A Downing Street spokesman said the trip was a family break unconnected to Mr Johnson’s parliamentary activities.

Downing Street in central London, the headquarters of the Prime Minister and the subject of questions over renovation work at Number 11. AFP
Downing Street in central London, the headquarters of the Prime Minister and the subject of questions over renovation work at Number 11. AFP

Downing Street flat back in spotlight

The opposition also wants to revive the issue of the Downing Street flat refurbishment, which hit the headlines in April and is being investigated by the Electoral Commission.

Mr Johnson lives in the flat above 11 Downing Street, the house next to his prime ministerial headquarters in London, with his wife, Carrie, and their young son, Wilfred.

He said he had settled the bill for the renovation himself after it was paid by a Conservative party donor, Lord Brownlow.

A report by an independent adviser in May did not find any wrongdoing but said Mr Johnson should have taken more interest in the funding arrangements.

Labour wants to bring the issue back into focus by accusing Mr Johnson of failing to disclose the details to Parliament.

The party has sought to use cronyism allegations as a line of attack against the Conservatives, who saw their poll ratings drop after the Paterson episode. Ministers have previously been found to have broken rules over contracts related to Covid-19.

Mr Paterson was accused by the ethics watchdog of breaking parliamentary rules by lobbying for companies for whom he was a paid consultant.

He denied wrongdoing, and Conservative MPs sought to circumvent his suspension by revamping the ethics system under a new committee.

But opposition parties, including Labour, said they would boycott the committee. The Conservatives backed down the following day.

Mr Paterson maintained that he was “totally innocent” but said his children had urged him to leave what he described as the “cruel world of politics”. He said his critics had mocked the death of his wife, Rose, who took her own life last year.

Our legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants

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Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Updated: November 06, 2021, 6:58 PM