The Conservatives yesterday promised to impose a £25,000-per-year charge for "non-domicile" taxpayers, but their web site still has a briefing attacking, what is now, their own policy from when the Liberal Democrats proposed a similar scheme a few years ago.
The document is titled the "Lib Dem tax sting" and they brand taxes on non-domiciles as a "City of London Tax". Here is the apparent rebuttal of their own policies:
"#7 - City of London tax
Liberal Democrats would ‘end the practice of giving non-domicile tax status’ (Liberal Democrats, Alternative Budget, Invest to Innovate, 8 March 2002, p.6).
Yet as the Evening Standard has warned, ‘a change in the tax status of non-domiciled resident individuals will devastate the London shipping business centred on the Baltic Exchange, cost thousands of City jobs, destroy London’s position as the international centre for shipping, undermine its ability to attract key foreign personnel in all its other areas of activity and result in a lower, not a higher, tax take for the Exchequer… When people talk about the competitiveness of the City, they usually refer to the number of foreign bankers and brokers who are happy to come here to work. These create the pool of talent that cements London's position as the leading international financial centre. A change in the rules will make them want to leave London. There is nothing the Government could do that would give a bigger boost to Paris, Frankfurt and Zurich, the rival Continental financial centres’ (Evening Standard, 26 March 2002).
A study by economists at Numerica has observed that abolishing non-domicile tax status would knock between £5 billion and £10 billion off Britain’s GDP (cited in Sunday Telegraph, 3 August
David Cameron may have given up smoking, but this is all policy written on the back of a fag packet stuff. The Tories are clearly struggling to get themselves ready for a possible election.