UK Deputy PM admits underpaying tax

Britain’s deputy prime minister, Angela Rayner, acknowledged on Wednesday that she had failed to pay adequate taxes when she bought a seaside apartment, raising questions about whether she can hold on to her position and creating another political headache for Prime Minister Keir Starmer

Ms. Rayner said she had not tried to evade taxes, having relied on legal advice about how to handle a complex property transaction that involved another house she owned with her ex-husband.

But she said that she had referred herself to the prime minister’s ethics adviser, who would investigate whether she violated the code of conduct for cabinet ministers.

For Mr. Starmer, whose government has struggled to find political traction amid a stagnant economy and erratic economic policies, Ms. Rayner’s admission is a major new distraction.

It adds to a perception of ethical laxity among senior members of the Labour government, including Mr. Starmer, who last year disclosed accepting donations to buy clothing for himself and his wife, and free tickets to soccer games.

Adding to the political complications for Mr. Starmer, Ms. Rayner is the government’s top housing minister. She is spearheading a Labour pledge to build 1.5 million additional homes in the five-year term of this Parliament.

The prime minister expressed support for Ms. Rayner, saying in Parliament that “she has explained her personal circumstances in detail” and that she had acted properly in referring herself to the ethics adviser.

With a grim-faced Ms. Rayner sitting behind him, Mr. Starmer added that he was proud to serve alongside a working-class woman who had risen to the top levels of the British government.

“It has been quite a distressing time for my family,” a subdued Ms. Rayner told Sky News. She said that she had contacted the tax authorities to notify them that she owed additional “stamp duty” — a tax paid by the buyer of a residential property above a certain price — on the apartment in Hove, on the southeast coast of England, which she bought last May.

But Ms. Rayner, 45, insisted that the underpayment was innocent. She said the mistake was a result of arrangements involving a financial trust for her disabled son, established in 2020, and another house near Manchester, which she had owned with her ex-husband and where she still lives some of the time.

Ms. Rayner said that she and her ex-husband, whom she divorced in 2023, now alternated living in the house, where they cared for their son. The trust was designed to secure part-ownership of the house for the child.

“To ensure he continued to have stability in the family home, which had been adapted for his needs, we agreed that our interest in the family home would be transferred to this court-instructed trust of which he is the sole beneficiary,” Ms. Rayner said in a statement.

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