Chancellor Rachel Reeves is going through strain from lobbyists representing the UK’s 74,000 non-domiciled residents (non-doms) to cut back her deliberate tax adjustments, forward of her upcoming price range.
The newly shaped group, Overseas Traders for Britain, is ready to fulfill with authorities officers this week to induce a reconsideration of Reeves’s proposed overhaul of the non-dom tax regime, which may embrace levying inheritance tax on overseas belongings.
Non-doms, who’re UK residents however are thought of domiciled abroad for tax functions, are at present exempt from paying UK taxes on their abroad revenue. Nonetheless, Reeves’s proposed adjustments have sparked fears that rich non-doms will depart the UK, doubtlessly inflicting a web loss in tax revenues quite than boosting the Exchequer. In 2022-23, non-doms contributed £8.9 billion to UK tax revenues.
The foyer group, which shaped in June and has already met with Treasury officers, is proposing an alternate tiered tax system. This is able to see non-doms paying a hard and fast annual sum, scaled to their wealth, for a interval of 15 years. Below the plan, somebody with as much as £100 million in private wealth would pay an annual cost of £200,000, with these value greater than £500 million contributing £2 million yearly. Presently, non-doms pay as much as £60,000 a yr.
Leslie MacLeod-Miller, a spokesperson for Overseas Traders for Britain, stated: “We’re pleased the government is listening because this is a real issue. Britain is turning into a departure lounge, and without changes, we risk losing valuable investment and tax revenue.”
The federal government has to date defended the proposed adjustments. A Treasury spokesman stated: “We are addressing unfairness in the tax system to raise revenue for rebuilding public services. The outdated non-dom tax regime will be replaced with a new residence-based regime focused on attracting the best talent and investment to the UK.”
The non-dom debate comes amid broader considerations about Reeves’s first price range, which is predicted to incorporate important tax reforms as Labour seeks to rebuild the nation’s funds.
