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Labour would abolish non-dom tax regulations


The Labour party has claimed that if Ed Miliband is elected as Prime Minister in the May general election, they will scrap the non-domicile rule that allows some wealthy UK residents to limit the tax paid on earnings outside of the country.

Non-domiciles are British citizens with interests abroad who do not pay tax on earnings outside of the UK because either their permanent home is not in the UK or their parents are not British citizens. Ed Miliband has claimed that it is a form of tax avoidance, and makes Britain “an offshore tax haven”.

Under the new regulations, no one will be able to apply for non-dom status after April 2016, and all current non-doms would be given a short period of about five years to sort out their affairs. The move is expected to affect about 115,000 people in the UK.

In a speech at the University of Warwick later today, Ed miliband will say:
“There are people who live here in Britain like you and me, work here in Britain like you and me, are permanently settled here in Britain, like you and me, but aren’t required to pay taxes like you and me because they take advantage of what has become an increasingly arcane 200-year-old loophole.

"I want to be clear. I don't blame people for taking advantage of non-dom status. I blame governments for fostering a system that can be taken advantage of."

Shadow Chancellor Ed Balls told the BBC this morning that the new regulation could raise hundreds of millions of pounds, but could not give an exact figure.

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