TaxCorporate TaxGreat tax debate needs reason and reliability

Great tax debate needs reason and reliability

The TUC has got the bit between its teeth on tax

Gavin Hinks, AccountancyAge

Not content with attacking the tax status of private equity ­ and prompting a
parliamentary inquiry as a result ­ secretary general Brendan Barber has now
turned his sights on outlawing non-domiciled tax status.

With the help of research from tax consultant Richard Murphy, Barber revealed
at the TUC’s Brighton conference an estimate that if 20% of non-domiciles left
the UK, the exchequer would still be better off to the tune of £4.3bn.

The calculation must be difficult given the inherently private nature of
non-domicile finances and it would certainly need verification. But perhaps the
bigger question is what kind of other decisions non-doms might make if they were
not permitted their special status in the UK. Would they invest elsewhere? Would
other tax benefits be lost as a result of the job losses that might follow? How
do you calculate those costs?

More interesting is the way in which union activists appear to be trying to
determine tax policy through the targeting of specific measures, especially
those that appear to benefit the rich.

Organisations like the TUC have PR clout and one of the key lessons from the
private equity debacle was how badly the industry handled the public
presentation of the issues.

Partly it’s complacency, partly the fact that mentioning the rich and low tax
in the same sentence is guaranteed to provoke a storm of controversy and press
headlines.
And that’s why any debate about tax and the rich has to be carried out with a
cool head and with numbers we can all rely on. Without that, emotive indignation
will drive the debate ­ and with it, the outcome.

comment@accountancyage.com

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