TaxPersonal TaxTreasury adviser slams non-dom levy

Treasury adviser slams non-dom levy

Fears rise that new tax will drive high earners out of London

A leading Treasury adviser has warned the Government’s ‘ill-conceived’ plans
for a crackdown on non-domiciled UK taxpayers are likely to damage London’s
standing as the world’s leading global financial centre.

Bob Wigley, chairman of Merrill Lynch Europe, Middle East and Africa, added
his voice to rising criticism of the proposal, which would levy an annual
£30,000 on taxpayers who want to avoid UK tax on foreign income which is kept
outside Britain – and cut their use of offshore vehicles for avoiding tax.

UK-domiciled Wigley, who is a member of Chancellor Alistair Darling’s group
of ‘wise men’ who advise on keeping London competitive, told
the
Sunday Times
: ‘This proposal was ill-conceived from the start. While it
clearly has some political attraction, the economic case is flawed.’

‘These measures were partly aimed at the non-domiciled billionaires. They
could, if not withdrawn or substantially amended, drive offshore young upcoming
talent that currently chooses to live in London, so making London the leading
global financial centre.’

He added: ‘When you consider that most of those who could be driven away
probably don’t use the state education or health systems but spend a lot of
their above-average incomes here, so contributing disproportionately to Vat
receipts, these are exactly the good-value taxpayers London should want to
retain.’

According to Treasury calculations, the planned tax will raise £800m in
2009-10 and £500m in 2010-11.

Further Reading:

Read
the Sunday Times story

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