Nigel Farage’s attempts to shake off a deepening scandal over gifts he received by calling a byelection appeared to have backfired as his main rivals announced they would boycott the contest.

In a defiant announcement on Tuesday, the Reform UK leader said he was quitting as the MP for Clacton to fight again for his seat, as he wanted to be judged by voters and not the establishment or the media.

Farage claimed there was a plot to prevent a Reform government and accused the media of a “pile-on” and of harassing his family. He also said the party was offering to pay the costs of a byelection, which can reach more than £250,000.

However, his opponents quickly accused him of trying to divert attention from the serious allegations he is facing about failing to declare a £5m gift from the crypto billionaire Christopher Harborne and financial support from his friend, the convicted fraudster George Cottrell. Both gifts are under investigation by the parliamentary standards watchdog.

Within hours, the Conservatives, Labour, Restore Britain, the Green party and the Lib Dems all announced that they would not stand candidates for a “media circus” and a “vanity project”.

The Lib Dems also called for the byelection to be blocked until the verdict of the standards inquiry, which would be suspended during a byelection and then may be resumed afterwards.

A byelection could take place as soon as August, with the main parties initially torn over whether to seize the opportunity of trying to oust Farage or avoid giving him a platform to air grievances about the investigations against him.

However, almost all of them decided against, with Rupert Lowe, of Restore Britain, the first to say his party would not participate in a byelection until after the verdict of the standards commissioner.

Labour’s ruling executive decided to opt out after a meeting on Tuesday night, with a spokesperson saying Farage was “engulfed in a sleaze scandal and he’s desperately trying to change the subject”.

“It’s pathetic, and the Labour party is not going to indulge it,” they added. One senior ally of Andy Burnham, who is expected to become Labour leader and prime minister later this month, said the party was wary of engaging all of its firepower at a Clacton byelection when the new prime minister was aiming to dominate messaging during the summer recess.

“We need to get out to the country, all guns blazing, real positivity and lots of big announcements focused on hopes. I would be very worried if we got distracted by a Clacton sideshow,” one said. Another Labour figure said the party should let Farage fight the contest against the novelty candidate Count Binface in order to expose the process as a farce.

A spokesperson for Burnham said it was a “gimmick designed to distract from serious allegations about Farage’s funders”, while Kemi Badenoch, the Conservative leader, said Farage was throwing a “hissy fit” and “cracking under pressure” as he cannot handle scrutiny.

“There should not be a byelection on his terms. There should be a byelection if the investigation finds him guilty,” the Tory leader said.

Starmer said Farage’s announcement was “a desperate stunt” from a man “up to his neck in sleaze”.

In his afternoon statement, Farage said he had done nothing wrong and claimed that the standards system was being used as a “political tool”.

“I thought about it hard and I’ve decided today I will resign as a member of parliament for Clacton-on-Sea, thereby forcing a byelection … I’ve decided that the people of Clacton should be the judges of my actions,” he said.

“This will be a people versus the establishment byelection. It’s a chance to stick two fingers up to the entire establishment to frankly tell them where to go and that is why I will be putting my name forward to stand in this byelection.

“I will fight to win. I will fight to continue the political revolution that Reform has started and I would say this to you, the voters of Clacton: If I win, you win.”

Farage won the seat with a majority of 8,400 in 2024, with the Conservatives coming second and Labour third. However, he could face a wave of tactical voting against him if there were to be an alliance of progressive parties, or an anti-sleaze independent candidate put forward.

Supporters of Farage praised his decision as brave, with Reform’s home affairs spokesperson, Zia Yusuf, saying it was “history being made” after Farage “laid down the gauntlet to the establishment”, with the future of the UK at stake.

Another member of Farage’s inner circle, Raheem Kassam, said it “defangs the media, turning any and all issues into a democratic exercise, rather than allowing himself to be tried by the nation’s corrupt press”, and he claimed that it also “stuffs the Tories and Restore” as well as neutralising the parliamentary standards investigation.

“If, somehow, he loses, it will be with his head held high, having put the voters first. It beats being browbeaten by the press, or by some bureaucrat,” he added.

Reform sources were particularly pleased that Lowe’s party has decided not to run. A source close to Farage’s operation said: “Just as we knew he would, Rupert Lowe IQ punked out with a statement showing he’s on the side of the deep state apparatus against Farage.”