War may be raging in Ukraine but Friday’s front pages in Britain were taken over by the non-domicile tax status of Rishi Sunak’s wife, Akshata Murty, which the chancellor dismissed as a smear campaign.

It remains to be seen whether Sunak’s prospects of becoming Britain’s first Indian origin Prime Minister one day have now been damaged beyond repair.

What was extraordinary was the lead story in the Daily Telegraph which alleged that 10 Downing Street, was behind the smears — a claim categorically rejected by the Prime Minister’s spokesman.

To acquire “non-dom status”, Akshata, daughter of Infosys founder N.R. Narayana Murthy, pays £30,000 (Rs 29,67,270) a year but this enables her to avoid paying tax on her foreign earnings, including dividends on her Infosys shares, said to be valued at between £400 million and £690 million.

Akshata, unlike her husband, has retained her Indian nationality — India does not allow dual citizenship.

Labour’s shadow attorney- general, Emily Thornberry, told BBC Radio 4’s Today programme on Friday: “It may be legal but is it morally right? In the end, we have somebody who’s been living here for eight years, raising her children here, living at No 10 Downing Street in accommodation provided by the taxpayer and aspiring to be the wife of the next Prime Minister, and yet she says that she isn’t a permanent resident of this country.”

Sunak’s family lives in a flat above 10 Downing Street, while the chancellor’s more spacious apartment above No 11 has been bagged by the Prime Minister. Labour leader Keir Starmer said it would be “breathtaking hypocrisy” if she was reducing her bill while the chancellor raised taxes for millions of Brits.

The Financial Times was also not impressed with the arguments advanced in defence of Akshata and carried a report: “Tax experts attack UK chancellor’s wife’s ‘disingenuous’ defence of non-dom status.”

The chancellor gave an exclusive interview to the Sun newspaper, which was headlined, “LAY OFF MY MISSUS. My wife loves her country just like I love mine, says Rishi Sunak as he defends millionaire spouse over tax row.”

“People, I don’t think, have an issue with the fact that there’s an Indian woman living in Downing Street,” he told the paper. “I would hope that most fair-minded people would understand — though I appreciate that it is a confusing situation that she is from another country.”

And he insisted: “Every single penny that she earns in the UK she pays UK taxes on, of course she does. And every penny that she earns internationally, for example in India, she would pay the full taxes on that. That is how the system works for people like her who are international who have moved here.”

The chancellor added: “I can appreciate people find this situation confusing. But what it comes down to is, my wife was born in India, raised in India. Her family home is in India, she obviously has a very close connection. She has investments and a career independent of me. She had this well before we met, before she moved to this country.

“It wouldn’t be reasonable or fair to ask her to sever ties with her country because she happens to be married to me. She loves her country. Like I love mine, I would never dream of giving up my British citizenship. And I imagine most people wouldn’t.”

Akshata is listed on careers site LinkedIn as director of capital at private equity firm Catamaran Ventures, gym chain Digme Fitness and gentlemen’s outfitters New & Lingwood. She is also reported to hold a 0.91 per cent stake in Infosys.

Sunak said: “These are her choices, right? She’s a private citizen, and of course I support my wife’s choices. She’s not her husband’s possession. Yes, he’s in politics, and we get that but I think you know, we get that she can be someone independent of her husband in her own right.

“She has had her own career. She has her own investments and is paying the taxes that she owes in the UK. She is 100 per cent doing everything this country asks of her.”

But he said it was unfair to go after his wife because she is a “private citizen”.

He went on: “I’m an elected politician. So I know what I signed up for. And you know that my motivation in this is trying to do the right thing for the country.

“And I know that that’s not always popular. So I didn’t get into this to have popular headlines, I got into this to do what I think is right.

“And I’m signed up for that and you know, you’re going to get criticism for the decisions you make. But it’s different when people are trying to attack you by coming at your family and particularly your wife. It’s unpleasant, especially when she hasn’t done anything wrong. She hasn’t broken any rules. She’s followed the letter of the law.”