'Closing tax loophole would lead to exodus of wealthy'
Friday 06 September 2002
Opposition is mounting to Government plans to close a tax loophole that allows thousands of wealthy UK residents to pay a pittance to Inland Revenue.
The Treasury is looking at drawing non-domiciled UK residents – people who live in Britain but claim another country as their homeland – further into the tax net.
It is expected to publish a consultative document in November that could propose limiting to five years the length of time a foreign national could claim the status.
Currently non-domiciled residents do not have to pay any income or capital gains tax on assets held overseas. It is estimated to cost the Exchequer about £1bn and benefit 60,000 people, most of whom shy away from publicity.
But the Baltic Exchange, the London market for shipbrokers, has warned it will trigger an exodus of foreign shipowners. It said a study commissioned from a Cambridge academic showed a potential loss of 4,500 jobs, £125m in tax revenue and £375m in maritime earnings.
John Buckley, its chief executive, said: "If the long-standing benign arrangements for foreign shipowners were altered, maritime London and the economy generally would face a very serious threat."
Tax experts said the effect could be widespread. Paul Knox, director of private client services at Ernst & Young, said the rule had been a "fundamental tax principle" for years.
"A change in the rules without giving proper thought to the overall impact could switch the UK from being a flexible place for foreigners to spend time to being one of the most disadvantageous places and the ramifications could be quite significant," he said.
A Treasury spokesman said: "We are aware of the views of some groups in the shipping industry but ... the rules should be fair, easy to operate and support the competitiveness of the British economy."
- 1 I've been called an abusive and dangerous parent, when all I did was listen to my transgender child
- 2 Why this father didn’t hide his daughter’s heroin overdose in her obituary
- 3 Company breaks open Apple Watch to discover what it says is 'planned obsolescence'
- 4 Teaching profession headed for crisis as numbers continue to drop and working lives become 'unbearable'
- 5 The most powerful passports in the world
Nepal earthquake in pictures: Photos show devastation caused by 7.8 magnitude earthquake
Smartphones are making children borderline autistic, says psychiatrist
Nepal earthquake: The race is on to help thousands trapped under rubble around Kathmandu, while remote villages face a long wait for help
Royal baby: Live updates as superbug closes ward at St Mary's Hospital where Duchess of Cambridge is due to give birth
Teaching profession headed for crisis as numbers continue to drop and working lives become 'unbearable'
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
The sickening truth about food banks that the Tories don't want you to know
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
General Election 2015: Britain would become a 'communist dictatorship' under Ed Miliband and Nicola Sturgeon, claims wife of Michael Gove
iJobs Money & Business
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...
£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is the o...