The Conservatives have been accused of opposing moves to abolish non-dom tax status because of their heavy reliance on wealthy donors who gain from the system.
Ed Miliband’s surprise pledge to scrap the tax breaks – which will be a key part of the Labour manifesto – provoked the bitterest exchanges of the election campaign so far.
The Tories leapt on a recent warning by shadow Chancellor Ed Balls that the policy could “cost Britain money”, but Labour insisted the move would attract overwhelming public support. It claimed the Conservatives’ approach was driven by its dependence on donations from a handful of super-rich individuals who have taken advantage of the status to reduce their tax bill.
Non-doms are believed to have contributed up to £16m to Tory coffers in recent years. Lord Laidlaw, who resigned from the Lords to retain his status, has handed £6.9m to the party individually or through his companies.
General election 2015: The worst gaffes and controversies
General election 2015: The worst gaffes and controversies
1/35 4 May: Milibrand part 2
Russell Brand dramatically unveiled the second part of his interview with Ed Miliband, in which he agreed with the leader and then called on his YouTube viewers to vote Labour. David Cameron had described him as a "joke" who previously advocated not voting - but with Brand commanding more than a million YouTube subscribers that may come back to haunt the Tories.
2/35 3 May: #EdStone
Labour leader Ed Miliband unveiled Labour's pledges carved into a stone plinth in Hastings. He said it showed his commitment to keep promises - but many mocked the "risible" stunt and said it would be the "tombstone" for Labour's election hopes.
3/35 2 May: Ukip candidate suspended
A Ukip candidate who described himself as “unapologetically politically incorrect pro-British” was suspended after suggesting Shadow Minister Luciana Berger had split loyalties because she is Jewish. In one Twitter message Jack Sen, standing in West Lancashire, said: “Protect child benefits? If you had it your way you'd send the £ to Poland/ Israel.”
4/35 1 May: 'It's all about my career... I mean country'
Labour jumped on another David Cameron gaffe after the PM said on the campaign trail that the election was a “career defining” moment when he meant to say “country defining”. Ed Miliband's party pounced, saying the remarks were proof Mr Cameron “puts his career before the country”. “It’s all about Dave,” the party tweeted.
5/35 30 April: The Sun has got two hats on
The Sun revealed who it was supporting in the election - both the Tories and, in Scotland, the SNP. While the UK edition of the newspaper called on the British public to vote Conservative so as to "stop [the] SNP running the country", The Scottish Sun announced its support for Nicola Sturgeon's party saying it will "fight harder for Scotland's interests at Westminster".
6/35 29 April: Complacent Conservative?
Tory Work and Pensions Secretary Iain Duncan Smith failed to turn up to hustings in his own constituency following a 'late change in his schedule'. Wags observed that it was ironic given the minister has ramped up monetary sanctions against people who do not attend job interviews or JobCentre meetings.
7/35 28 April: Offensively independent
An independent candidate standing in Northern Ireland proudly came up with the least 'politically correct' leaflet of the campaign. Susan-Anne White declared she would criminalise adultery and homosexuality, end sex education, reinstate corporal punishment and much more.
8/35 26 April: The Ed and Boris bust-up
In what was widely hailed as the best bit of election TV so far, Ed Miliband and Boris Johnson clashed head-to-head in angry scenes live on the Andrew Marr Show, forcing their usually genial host to intervene and tell the pair of them to "shut up". The increasingly animated London Mayor repeated personal attacks over Mr Miliband 'stabbing his brother in the back', while the Labour leader got in some jibes of his own about Mr Johnson's Eton education.
9/35 25 April: Political football
David Cameron’s football-loving credentials received a kicking at a campaign event in Croydon after he suggested to the audience he supported West Ham- despite previously claiming he was a huge Aston Villa fan. When asked about his sudden change in loyalty, Cameron later said he was still a Villa fan and blamed the slip up on a 'brain fade'.
10/35 24 April: Migrant crisis made political
Ed Miliband was branded 'shameful' by Downing Street after he said David Cameron was partly responsible for the deaths of hundreds of migrants in the Mediterranean. The Labour leader said the Prime Minister’s role in creating instability in Libya had contributed to thousands of north Africans drowning in the Mediterranean as they try to flee the crisis. A senior Tory called the comments 'deeply provocative'
11/35 23 April: IFS accusations
Voters are being kept 'in the dark' by all the main parties over future spending cuts and tax rises, the influential Institute for Fiscal studies said. A detailed study of the party manifestos by the think-tank concluded that none of the Lib Dems, Labour, the Conservatives or SNP had provided "anything like full details" on plans to cut the deficit over the next five-year Parliament.
12/35 22 April: The not-so-Green Party
A group of leading scientists and campaigners rounded on the Green Party, accusing it of turning its back on its main mission by largely ignoring the crucial issue of climate change in the run-up to the general election. Critics said that although the Green Party manifesto contains plenty of references to policies on global warming, the party was 'grievously at fault' for leaving the subject largely unspoken in campaigning by the party and its leader, Natalie Bennett.
13/35 21 April: Wikipedia edits
Tory party chairman Grant Shapps was accused of editing the Wikipedia pages of his Conservative rivals and allegedly changing his own page to delete embarrassing references to his past. A Wikipedia administrator reported and suspended an account called 'Contribsx' on suspicion it was being used by Mr Shapps or 'someone acting on his behalf'.
14/35 20 April: Dodgy Tory donors?
The Conservatives were forced to return more than £50,000 in donations from a businesswoman whose husband was convicted of tax fraud in the US. Beatrice Tollman, who donated £20,000 as recently as early April, was herself charged with conspiracy to evade millions of dollars’ worth of tax in the US, charges that were dismissed by a judge in 2008
15/35 19 April: Miliband a hit among the hens
Ed Miliband was described as "the stripper" by a group of women on a hen party in Chester after they spotted the parked-up Labour battle bus. But not everyone saw it as statesmanlike behaviour, some saying it was 'cringe-worthy' and others reporting he looked 'absolutely terrified'
16/35 18 April: DUP on gay marriage
A right-wing Democratic Unionist Party of Northern Ireland politician thanked Nick Clegg for 'reminding' voters that they are seeking to abolish same-sex marriage. After the Lib Dems set up a satirical website accusing the DUP of wanting to 'reject gay rights', North Belfast MP Nigel Dodds said he was grateful to Mr Clegg 'for reminding people of the pivotal role the DUP can play'
Joe Raedle/Getty Images
17/35 17 April: Labour 'metaphors'
A Labour candidate was forced to apologise for “getting carried away with colourful metaphors” after making a joke about being caught in a threesome with Ed Miliband and a goat. Clive Lewis, a former reporter for BBC Look East who is now standing in Norwich South, said "anything could happen" when asked if he could be beaten by the Greens. After the Miliband example caused a bit of a backlash he added: "If anyone was genuinely offended then I'm sincerely sorry for that."
18/35 16 April: Ukip candidate calls Islam 'evil cult'
A Ukip candidate standing for Parliament faced being sacked by the party after describing Islam as an “evil cult”. Stephen Latham, who is fighting the West Bromwich East seat, made the remarks in a Facebook post. He later said: "I wouldn’t have meant it about Islam itself. It would have been about the people causing problems."
19/35 15 April: Labour candidate 'forgets manifesto'
A video emerged of a Labour candidate suffering a terrifically awkward 'brain fade' and failing to name her party’s key policies. During an interview with local website The Chiswick Calendar, Ruth Cadbury (running for Brentford and Isleworth) froze: "Um… I can’t remember my key… I do need to check… I’m reading them every day... er… sorry… Labour’s key policies..."
The Chiswick Calendar
20/35 14 April: Tory candidate 'wristbands'
There were calls and a petition for the Conservative parliamentary candidate for Cambridge to stand down, after she said that mental health patients could wear colour-coded wristbands to identify their conditions. Chamali Fernando was accused of showing 'prejudice' and 'remind[ing] us how far we have to go' by mental health campaigners
21/35 13 April: Smarter than a 10-year-old?
Former PR man David Cameron is used to spinning his way out of trouble against the most challenging interviewers - yet came completely unstuck on a visit to a primary school for Newsround. With his guard down, 10-year-old Reema asked: 'If you could pick one politician apart from yourself to win who would it be and why?' Cameron said it was the 'best' question he'd had so far on the campaign, um-ed, ah-ed and failed to give a clear answer.
22/35 9 April: Ukip's porn star candidate
A mini-scandal surrounded Ukip's Bristol branch when it emerged the vice chair had an unusual second job as a veteran porn star. The party insisted it was happy to support candidates regardless of what they did in their spare time, adding proudly that 'no other party' would have taken John Langley - aka 'Johnny Rockard'.
23/35 8 April: Ed Balls on non-doms
No sooner had Ed Miliband announced a popular Labour policy to scrap the non-dom tax status, a video emerged of Ed Balls explaining how such a move would end up costing Britain more.
24/35 5 April: Tories taking care of business (owners)
In an interview with this newspaper Danny Alexander, the Chief Secretary to the Treasury, revealed that a senior Conservative minister told a Liberal Democrat cabinet colleague: 'You take care of the workers and we’ll take care of the bosses' in a private Whitehall meeting to discuss the Coalition Government’s priorities.
25/35 3 April: Nicola Sturgeon 'memo'
Nicola Sturgeon was forced to deny telling the French ambassador she wanted the Tories to win the election in May in preference to Labour, after a 'memo' to that effect was leaked to the Telegraph.
26/35 2 April: Nigel Farage on HIV
UKIP leader Nigel Farage sparked controversy during the ITV Leader's Debate 2015 for saying that immigrants who were HIV positive should not be able to enter the country and use the NHS for free.
Ken McKay/ITV via Getty Images
27/35 29 March: Labour mugs
Senior Labour MP Diane Abbott was among those who led a backlash against a mug being sold by the party celebrating its new commitment to a tough immigration system.
28/35 23 March: Ukip's Atkinson expelled
Janice Atkinson, an MEP and once one of Ukip's most senior figures, was expelled after she was found to have brought the party into disrepute. Ms Atkinson’s chief of staff was secretly recorded appearing to ask the manager of a restaurant in Margate to more than treble the £950 cost of a meal before Ukip’s spring conference. Nigel Farage later said the claims 'couldn't look worse'.
Chris Radburn/PA Wire
29/35 8 January: 'Meet the Ukippers'
Ukip councillor Rozanne Duncan was expelled from the party for saying she had a problem with black people because there was 'something about their faces' during filming for the BBC documentary 'Meet the Ukippers'
30/35 20 November: Emily Thornberry and the white van
Labour front bench MP Emily Thornberry was forced to resign after tweeted a photo of a house in Rochester adorned with three England flags and a white van out the front, which saw her accused of holding working class voters in 'contempt'.
31/35 22 October: Ukip Calypso
The former BBC Radio 1 DJ Mike Read was forced to apologise for "unintentionally causing offence" with his song Ukip Calypso and asked his record company to withdraw it. The song, which the Surrey-born disc jockey sang in a mock Jamaican accent, had been branded “racist”.
32/35 7 October: Forgetful Boris
During his Ask Boris show on LBC prior to the Clacton by-election last year, the London Mayor was asked by Nick Ferrari who the Tory candidate was. Boris replied: "We've got a fantastic guy called - oh he’s brilliant… I don’t know... he is superb man .. Stirling? Girling? Something like that… what’s he called? You tell me." It was Giles Watling, Boris.
33/35 18 August: Janice Atkinson
The senior Ukip MEP was forced to apologise after she was recorded by BBC South East Today describing a Thai constituent as 'a Ting Tong from somewhere'. It wasn't enough to see her disowned by the party - that came later when she was caught in a newspaper sting relating to expenses
34/35 16 May (2014): Nigel Farage on LBC
Nigel Farage's car-crash performance on LBC was one of his worst in recent years, and culminated in him saying he would be 'uncomfortable' with a Romanian family moving in next door. The gaffe later saw Ukip take out a full-page newspaper advert insisting it was not a racist party.
35/35 20 March (2014): 'Patronising' Grant Shapps
Grant Shapps, the Conservative chairman, came under pressure from across the political spectrum after a 'patronising' tweet in which he suggested Budget measures to halve bingo tax and cut the price of beer by 1p would 'help hardworking people do more of the things they enjoy'
The former Tory deputy chairman Lord Ashcroft gave more than £6.3m before relinquishing his non-dom status to sit in the Lords. His announcement that he has stepped down from the upper house clears the way for him to register again as a non-dom.
Sir Anwar Pervez, founder of Bestway cash-and-carry, has donated about £510,000 to the Tories personally or through his companies.
Lucy Powell, vice-chair of Labour’s election campaign, said: “The Tories are the political wing of the tax-avoidance industry. With non-doms funding their campaign, it’s no wonder the Tories won’t back Labour plans to abolish non-dom status.”
David Cameron claimed Labour was in chaos on the subject. George Osborne added: “This is a complete shambles from Ed Miliband. He has announced a policy on non-doms that has already completely unravelled.” The Chancellor also pointed to his decision to increase the levy that UK residents have to pay to qualify as a non-dom.
The Conservatives were handed ammunition by film of an interview in January in which Mr Balls said: “I think if you abolish the whole status, then it probably ends up costing Britain money because there’ll be some people who will then leave the country, but I think we can be tougher and we should.”
Labour sources insisted Mr Balls was referring to the prospect of non-dom status being swept away in its entirety without special arrangements for foreign nationals who live for short spells in Britain.
Explainer: Non-domicile status
How many “non-doms” are there?
Around 110,700 according to the most recent figures for 2012-13 released by HMRC – that’s up from 83,000 in 1997. Of these around 64,000 choose to pay UK tax on their worldwide income and capital gains. Only 46,700 take advantage of the ability to shield their global income from the UK tax man.
How much income tax do they pay now?
Collectively non-dom taxpayers paid approximately £6.2bn in 2012-13 according to HMRC. Those who took full advantage of the tax loophole paid £4.6bn.
Is that all they pay?
No. Since 2008 to benefit from the loophole, non-doms must pay an annual charge. It’s £30,000 a year payable after seven years as a UK resident, rising to £50,000 after 12 years. This will rise to £60,000 in in 2015-16.
And last year George Osborne announced non-dom UK residents for 17 out of the last 20 years will pay a £90,000 annual charge. These charges raised £223m in 2012-13.
How much extra would closing the loophole raise?
Very difficult to say. The answer depends on the value of their assets abroad and the income they would choose to take from them.
It also depends on how many convert to full UK domicile.
Some may decide to quit the UK altogether and HMRC could theoretically end up losing money as a result.
Is that likely?
The number of registered non-doms and the income tax yield from the group does seem to have declined since the Treasury first imposed a flat-rate fee in 2008.
But it’s impossible to say with certainty that this is due to people leaving Britain. The fall in the income tax yield might be because they are repatriating less income or have earned less on their UK assets.
How much does Labour think the reform will bring in?
Ed Balls quoted a tax lawyer who suggests closing the loophole could raise some £1bn. But the party is being cagey and in truth no one really knows. What we can say is that even under the most optimistic of scenarios the sums raised from closing the loophole are unlikely to be significant in the context of £667bn of expected total tax revenues in 2015-16 and a £90bn deficit. This will not have a transformative impact on the public finances.
But would it hurt jobs, as some are saying?
One of the justifications for Britain’s unusually generous tax regime for non-doms has been that it encourages the super wealthy to come to the UK and to spend and invest here (rather than splashing their cash in Switzerland or Monaco) and that this creates jobs. The Institute of Directors reiterated a version of this argument yesterday, saying Labour’s move would put off entrepreneurs from coming to Britain.
But the effect of the tax regime here is probably exaggerated. What makes the UK attractive to the super wealthy is its secure property rights and the excitements and luxury offered by London. These things will not change.
A more significant drag on the economic dynamism of the UK is probably the Government’s restrictions on non-EU immigration.
The Independent has got together with May2015.com to produce a poll of polls that produces the most up-to-date data in as close to real time as possible.
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