Chancellor Must Rethink on Non-Doms
Byline: ANDEEP MANGAL
So far all of the publicity over Chancellor Darling's plans to tax non-domiciles has focussed on the impact the new legislation will have on high net worth individuals. It is strongly suggested this group of taxpayers could be preparing to leave our shores and it is widely reported that this will have a negative impact on the economy, something that the Chancellor appears to be ignoring. But there is another impact which has not yet been fully exposed - these changes could also hit low paid foreign workers.
The recent proposals from the Treasury stated there will be an annual pounds 30,000 levy on non-doms (people living in the UK but still registered as resident abroad) unless they bring overseas assets on-shore to be taxed.
After heavy criticism from the business community, and from some Labour backbenchers, the Chancellor retracted the requirement to disclose offshore assets. But this change will not prevent the wealthy, and people who generate pounds 20 billion for the UK economy, from leaving Britain - something that will will hit low-paid workers hard.
This is because the policy change appears to be based on the assumption that all non-doms are very wealthy and motivated simply by the need to minimise UK taxation.
One can question this assumption as it is based solely on self-assessment tax returns and takes no account of the people wholly in the PAYE system, or non-earning spouses or children, who currently do not have to file UK tax returns but will have to do so for 2008/2009 onwards. Many of these people will be completely unaware of this change, and that they may have to pay more UK tax.
If a non-dom does not …
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Publication information: Article title: Chancellor Must Rethink on Non-Doms. Contributors: Not available. Newspaper title: The Birmingham Post (England). Publication date: February 19, 2008. Page number: 11. © 2009 Birmingham Post & Mail Ltd. COPYRIGHT 2008 Gale Group.