Nadhim Zahawi slams 'smears' over tax affairs as race for UK leadership gets dirty

Eleven Conservative Party candidates are now vying to become prime minister after Foreign Secretary Liz Truss puts her name forward

British Chancellor of the Exchequer Nadhim Zahawi leaves his home in central London on Monday, as reports surfaced that his tax affairs were being officially audited. Reuters
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Conservative Party leadership candidate Nadhim Zahawi said on Monday he was being smeared over his tax affairs as the search for Britain’s next prime minister threatened to descend into an ugly briefing war.

Mr Zahawi said he was not aware of any inquiry into his business affairs and promised to publish his tax returns if elected leader, after anonymous briefings to the media that his taxes were being audited by officials.

The claims emerged shortly after Mr Zahawi helped to trigger the leadership contest by joining a Cabinet mutiny against Prime Minister Boris Johnson, who announced his intention to resign on Thursday.

Mr Zahawi is one of 11 candidates to have entered the race, with party rulemakers expected to set out the timetable for the contest later on Monday as negative briefings do the rounds in Westminster.

"It’s not been our best start," said Sajid Javid, a former health secretary seeking the leadership. "Poisonous gossip, attack memos, allegations thrown around... this isn't House of Cards or Game of Thrones".

Mr Zahawi told Sky News he was "clearly being smeared... I've always declared my taxes."

Foreign Secretary Liz Truss became the 11th candidate to put her name forward overnight, echoing many of her colleagues by promising tax cuts if she becomes prime minister.

"Under my leadership, I would start cutting taxes from day one to take immediate action to help people deal with the cost of living," she wrote in the Daily Telegraph.

Trade Minister Penny Mordaunt said she would halve VAT on fuel if elected, while Mr Zahawi, appointed Chancellor of the Exchequer last week, said every department would be told to cut costs so that taxes could come down.

Mr Javid used his launch speech to promise that an income tax cut would be brought forward by a year to 2023 and that fuel duty would be cut an an emergency budget.

Clockwise from top left: Rishi Sunak, Jeremy Hunt, Grant Shapps, Nadhim Zahawi, Kemi Badenoch, Suella Braverman, Boris Johnson, Rehman Chishti, Tom Tugendhat, Penny Mordaunt, Sajid Javid and Liz Truss. PA / Reuters / UK Parliament

Almost alone in playing down the prospect of tax cuts is former chancellor Rishi Sunak, who used a slick campaign video to say he would bring realism rather than "comforting fairy tales".

A leaked dossier said to be circulating among Mr Sunak's opponents said he had been a high-tax chancellor who was too close to the tarnished Johnson government.

After journalists spotted the name Patrick Robertson on the dossier's file data, The Times reported that an aide of that name who works for Home Secretary Priti Patel had admitted circulating the memo, but denied writing it.

All eyes were on Ms Patel, a hardliner on immigration urged by some Conservatives to enter the race, as the deadline loomed for her to announce her intentions.

Sir Keir Starmer, the opposition Labour leader, accused the tax-cutting candidates of plucking promises from a "magic money tree" - turning the tables on Conservatives who have often made the same complaint against Labour.

Tom Tugendhat, a backbench MP who is pitching his candidacy as a clean break from the Johnson years, promised on Monday to bring back "seriousness and integrity" as well as making the ubiquitous call for tax cuts.

"I have a vision and I have a 10-year plan," said Mr Tugendhat, a former soldier. "I've shown that I can lead where it matters, that I will stand up and be counted."

Mr Johnson, making his first public remarks since he announced his resignation last week, said he would not come out in favour of any of his potential successors.

"The job of the prime minister at this stage is to let the party decide, let them get on with it, and to continue delivering on the projects that we were elected to deliver," he said.

Candidates who served under Mr Johnson emphasised their experience. Ms Truss said she had served in six departments and would "hit the ground running" as prime minister on issues such as the economy and the war in Ukraine.

Transport Secretary Grant Shapps, regarded as one of the government's most effective communicators, won the backing of Environment Secretary George Eustice, one of the few current Cabinet members to have made an endorsement so far.

Michael Gove, who was fired from the Cabinet by Mr Johnson last week but is seen as a potential kingmaker, revealed he was backing junior minister Kemi Badenoch because she was "brave, principled, brilliant and kind".

Mr Javid recycled an advert from his failed leadership campaign in 2019, saying he did not have "a fancy new video" in an apparent swipe at Mr Sunak.

Attorney General Suella Braverman promised to get tough on Brussels in an overture to Brexit supporters, while another former health secretary, Jeremy Hunt, said he wanted to cut taxes without increasing the national debt.

And eyebrows were raised on Sunday when Rehman Chishti, a little-known MP recently appointed a junior minister, entered the race with a low-budget video calling for "aspirational conservatism" and a fresh start.

Some MPs called for the rule-making 1922 Committee to raise the bar for entry to the race, to stop it descending into prolonged blue-on-blue warfare.

Backbench MP Tobias Ellwood quipped that he "might be the only one voting" if the list of candidates kept growing as he called for weaker candidates to be filtered out more quickly.

After the committee sets out the timetable on Monday, Tory MPs are expected to vote in the coming weeks to whittle down the list to two options to be put to the wider party membership.

Members will then vote over the summer, with Mr Johnson planning to remain in office on a caretaker basis until a winner of the contest is announced.

Conservative leadership candidates – in pictures

Updated: July 12, 2022, 3:53 PM