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'Non dom' no more...

Posted by
16 Apr 2015
It’s been another exciting week in the Election as we reach the final three weeks of campaigning prior to the big day. At the start of last week it looked like the news would be dominated by Nicola Sturgeon’s surprise performance in the debates, but it was a taxation story which caught the eye of the media and voting public alike.

Labour surprised everyone by announcing a policy to scrap ‘non-dom’ tax status should they be elected (or able to form a government) on 7th May.

The policy proved popular, a poll conducted by Survation found that 59% of voters agreed with it, whilst only 16% are opposed, with even one in two Conservatives in favour of the policy.

The announcement also saw Duncan Bannatyne switching allegiance to the Labour party, not a week after signing the 100 business leader’s letter to The Telegraph stating that the Conservative led government had been good for business. He has been a huge advocate of ending this 200 year old law and took to Twitter to offer his support. The Financial Times recently criticised this status following the revelation that British born resident Stuart Gulliver of HSBC had only paid tax on UK earnings, as he had ‘non-dom’ status due having lived in Hong Kong for an extended period.

I remain unconvinced. Along with the Mansion Tax it seems that Labour are clinging to policies as great white hopes to raise additional funds which they promise will be ploughed into public services, the NHS and reducing tuition fees, but the sums just don’t add up. Fair taxation is a key issue for voters, who have felt hard done by following the bailing out of banks, whilst bankers still earned bonuses, and the continued coverage of corporations and individuals avoiding tax – but this seems to me no more than lip service addressing a small part of a wider problem.

The Conservatives and economist Robert Peston have argued that it could actually be damaging for the economy. Peston is concerned about international students and doctors living and working in UK, who could be caught up in a tax nightmare if the law is sped through in the two years suggested by Ed Balls. George Osbourne has been more aggressive in his critique, suggesting this could actually cost the country in excess of £100m if the superrich were to move their operations outside of the UK.

What we have seen is that this policy announcement coincided with a surge in the poles for Labour and saw Ed Miliband’s approval rating leaping up and above David Cameron's for the first time since he became leader of the Labour party.

A good bit of rhetoric for Labour, but as the manifestos have been launched, the polls have given the Conservatives a narrow margin again. This race is by no means over. The debate tonight could be key in determining which opposition party will be working with who come 8th May!
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