Non-dom rule should be ‘scrapped’
The TUC has called for the rule that sees non-domiciled business owners paying a £30,000 charge after seven years to be dropped as it penalises businesses owned by standard UK taxpayers. The call came in the TUC’s Budget submission. The TUC argued that businesses owned by non-domiciled residents are exploiting the non-dom tax loophole to gain an unfair advantage over businesses owned by standard UK taxpayers. By allowing generous tax arrangements for non-dom owned businesses, the rule discriminates against genuine business competition. Non-dom businesses can avoid paying tax on export profits by registering their company in an off-shore tax haven, the TUC submission said, giving them a major advantage on cost compared to businesses owned by standard UK taxpayers. The government’s proposed reforms would not solve the problem because non-dom business owners will still be able to use this unfair advantage for seven years and then pay £30,000 to continue enjoying the advantage after that. The TUC, therefore, called for the non-dom rule to be scrapped altogether. Brendan Barber, the TUC’s general secretary, said: “If the UK is to survive in today’s ultra-competitive global economy, it needs a tax system that rewards business innovation and productivity not the ability to exploit tax loopholes.” Date:5 March 2008
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