As London-based Indian entrepreneur Akshata Murty, the wife of UK treasury chief Rishi Sunak, faces ongoing criticism of her non-domiciled tax status – entitling her to avoid paying UK taxes worth millions on her overseas income – reactions in her home country have ranged from support to censure. Murty, whose father Narayana Murthy co-founded IT giant Infosys in 1981, is considered “richer than the Queen” for her 0.9 per cent stake (worth almost US$1 billon) in the company. After party-loving Boris, will teetotal Rishi Sunak be Britain’s next PM? The 42-year-old was entitled to a dividend payment of about 11.6 million pounds (US$15.1 million) from the India-headquartered company last year. But non-domiciled tax status means she can benefit from a provision in a 1956 treaty that was designed to stop Indian citizens being double-taxed on their estates in the UK and India, the BBC reported. While her tax arrangements are legal, the British public has been up in arms over the matter, given that her husband is Chancellor of the Exchequer. There will now be an inquiry into Sunak’s financial affairs and whether he had properly declared his interests. UK finance minister Sunak requests review of financial declarations The BBC reported that as a UK citizen, Murty would have paid tax of 39.5 per cent on the dividends. As an Indian citizen, the Indian government requires a withholding tax on dividends at 20 per cent. So if Murty had chosen UK tax domiciled status as an Indian citizen, the UK government would tax the difference between what she paid in India and what she would pay as a UK citizen. Ms Murty saves 2. 1 million pounds (US$2.7 million) per year through her “non-dom” status, the BBC said. To quell the controversy, Murty on the weekend said she would pay British tax on her global income, including dividends and capital gains, for the 2021/22 tax year and in future. Back in India, T.V. Mohandas Pai, a former Infosys director, defended Murty in a Twitter post. “She has no liability to pay any such tax. But you lie when you say there is no tax, there is a withholding tax in India on dividends paid overseas,” said Pai, who is chairman of Manipal Global Education, a private higher education company. In the “London Eye” column for Indian business news channel CNBCTV18, writer Sanjay Suri described the furore as akin to an “all-out attack on a common enemy”. He suggested Murty’s tax information was leaked by those “at the very top”. “The real aim is to get Rishi Sunak, seen by many until this attack as the prime minister in waiting,” he said, referring to how Sunak’s political star had risen as UK Prime Minister Boris Johnson battled for his political survival. Sunak’s popularity among Conservative Party members has since fallen. Others disagreed. Corporate lawyer Shalini Aggarwal, who is qualified to fight cases in India’s High Court, said non-domiciled status can also be sought to avoid paying UK tax on income from dividends from foreign investments, rental payments on property overseas or bank interest. Rolls-Royce, batmobile, Skoda: Indian billionaires and their cars “While it is a legal practice, the morality of Murty’s decision to claim non-domiciled status while living in London and being married to a serving chancellor is unethical. “She remains an Indian citizen, and has now said she will no longer be claiming non-domiciled status in her tax returns. Why did she not do this earlier? Her decision to rescind her non-dom status now casts doubts on her integrity,” said Aggarwal. Murty and her husband grabbed headlines in March after it was revealed Infosys had not closed its Russian office following the invasion of Ukraine. While Infosys is headquartered in India, which has refused to condemn Russian leader Vladimir Putin, Murty’s share in Infosys placed the company under pressure to follow Sunak’s advice to British firms to “pull out of Russia”. Loved by India’s Modi, Cuba’s Castro, ‘wood’ you believe this miracle tree? Infosys has since shut down its office in Russia, and is finding replacement roles for all its staff. Murty owns other businesses in the UK including her fashion label, Akshata Designs. She is a director at Catamaran Ventures, an investment firm owned by her father. She and Sunak also co-own luxurious properties in England and the state of California. Geeta Luthra, a senior lawyer who fights cases in the apex Supreme Court, pointed out that the tax that Murty had to pay in India was no small sum. In recent years, taxation had become increasingly steep, resulting in Indian entrepreneurs relocating to tax havens such as Mauritius or Cayman Islands, or even the UK “where they find the financial ecosystem more conducive to their business and personal growth,” she said. Rich Indians flock to Dubai, US for booster shots amid Omicron fears Those who knew Murty in her younger days say the controversy she has found herself engulfed in is in stark contrast to her low profile and quiet upbringing in India. Born in Hubli, a historic city located in the southern part of India’s IT hub Bangalore, Murty attended the strict, Methodist and all-girls Baldwin Girls High School during the 1990s. Students are required “to keep their nails clipped and shoes polished while eschewing fancy jewellery or trendy hairdos,” said Chennai-based Vandana Shetty, who is a former student. Teachers remember Murthy as diligent, disciplined, but talkative. “We never had any disciplinary problems with Akshata. She was well-behaved and did her homework on time. However, I do remember pulling her up occasionally for chatting with friends during class,” a former English teacher who declined to be named told This Week in Asia. Why Indians are trading cities for promise of a relaxed life in Goa Peers recall a “humble and simple” girl. “In the 1990s, we used to have not more than 20 students in a class so all of us knew each other really well,” a former school mate said. “Akshata’s parents were successful and rich, but she never flaunted her wealth. She would arrive at school not in a fancy, chauffeur-driven car as many of us expected her to, but in an autorickshaw with her brother and other kids.” Murty later attended Claremont McKenna College, California, where she studied Economics and French. She also did a diploma in Apparel Manufacturing Technology at the Fashion Institute of Design & Merchandising in Los Angeles. She later completed her MBA at Stanford University’s Graduate School of Business where she met future husband Sunak and the father of her two daughters. The two wed in 2009 at a simple ceremony at Leela Palace Hotel in Bangalore.