July 24, 2024

The tax lawyer who brought down Nadhim Zahawi

The tax lawyer who brought down Nadhim Zahawi
The tax lawyer who brought down Nadhim Zahawi

Illustration by John Watson

Dan Neidle is not obviously out to excite. When I ask the unlikely toppler of the “tax-careless” Tory chair Nadhim Zahawi for anything about him that might surprise people, he says, “I like growing tomatoes.” And his mum, working in advertising in the late 1960s, dreamt up the famous “man in black” Milk Tray ad. But other than that, his was a conventional rise. After an “excellent” Watford comp, he climbed the ranks of Magic Circle law firm Clifford Chance, doing well enough to retire in Norfolk at the ripe old age of 49.

His passion project is a new specialist thinktank, Tax Policy Associates. There’s a vaguely progressive tilt to the work—it recently highlighted the perversity of HMRC slapping “late filing” fines on people too poor to pay income tax—but the impulse is technocratic. Like the Institute for Fiscal Studies (also originally founded by City professionals with some time and money), the animating ideal is making a bewildering tax system coherent. While there’s inevitable argument about what tax rates are appropriate, Neidle thinks good tax policy “can be agreed by left and right”. 

The City can be cut-throat, but you don’t lie or your career’s over

What screws things up are “arbitrary lines in the sand, which mean uncertainty for good taxpayers and avoidance for bad”. He has written “a bit of code” that proves ebook prices didn’t budge after a VAT exemption: “You’ve surrendered £200m of public money, and it’s gone straight to publishers’ profits,” he says. Likewise, retailers gobbled up the long-campaigned-for VAT cut on tampons. MPs are debating VAT-free sunscreen: another costly gimmick, he fears. Quietly a Labour member, he wants windfall levies on energy profits, but the design is all-important: after BP’s heavy losses from writing off its stake in Russian oil firm Rosneft, it would be wrong to whack it as hard as Shell.

In short, he’s a man of insistent precision in a populist age—which was enough to make him a political assassin. As a rule, he’d prefer to “resist the lure” of going after individuals, but with “something as big as the chancellor [Zahawi’s job last summer] not paying tax, I had to follow it.” The six-month trail of sleuthing, shifting responses, press exposés, bullying lawyers’ letters and defiance, which ultimately saw the disgraced millionaire minister sacked, is meticulously documented on Neidle’s website. What does he take away from the experience?

The first “awful lesson” was “the difference with politics and the world I’d previously been in”. The City can be “cut-throat”, but you don’t lie or “your career’s over”. He had thought “the same rules applied” in politics, and that while Zahawi might dissemble, he wouldn’t “just lie”. The next shock was receiving libel threats along with claims he couldn’t mention them to anyone, which is a “widespread practice” for silencing newsrooms. He’s traced the root of such intimidation not to libel law as such but professional regulation—and is making headway with the Solicitors Regulatory Authority about a tweak.

He “goes dewy-eyed” thinking about the journalists who tracked down the details that, combined with Neidle’s expert prosecution in the court of public opinion, did for Zahawi. He would rather “gargle on broken glass” than go into politics proper, and expects his latest tax hit-job on Labour’s Ian Lavery to be his last for a while.  

But, when prodded, he has thoughts on how a Labour government could raise billions. And while at pains to explain that Rishi Sunak’s controversial American green card was “the opposite of tax avoidance”, he has questions about the exact consequences of his wife’s non-dom status. It could be a while before he can be safely left to his tax-law manuals and tomatoes.