UK Finance Minister Rachel Reeves speaks on CNBC’s Squawk Box outside the World Economic Forum in Davos, Switzerland, January 22, 2025.
Gerry Miller | CNBC
The Treasury has confirmed that the UK will ease some planned changes to its controversial non-tax rules following millionaire exodus concerns.
Britain’s 200-year-old non-ruling regime allows people who live in the UK but are domiciled elsewhere for tax purposes to avoid paying tax on income and capital gains for up to 15 years. The regime has long been controversial, with Britain’s leading finance minister Rachel Reeves October budget To confirm the abolition, which will begin in April 2025, all long-term residents will be subject to inheritance tax on their worldwide assets, including assets held in trusts.
Speaking at a fringe event at the World Economic Forum in Davos, Reeves said the government would soon table amendments to the country’s finance bill, adding to the generosity of rules that would allow non-DOMS to transfer their money. Bring it to the UK without paying a lot of tax.
“We’re always listening to the concerns raised by the non-DOM community,” Reeves told the Wall Street Journal’s Emma Tucker when asked about the recent ultra-wealthy round-trip.
She added: “In the Finance Bill we will introduce an amendment to make the temporary repatriation facility more generous, which allows non-Dems to bring money into the UK without paying significant tax.”
Reeves also sought to reassure wealthy overseas investors on Thursday that the changes would not affect double tax deals the UK has with other countries.
“There is some concern among countries that have double tax arrangements with the UK, including India, that they will be attracted to pay inheritance tax. That is not the case. We will not change those double tax arrangements,” she said.
In a statement confirming the plans to CNBC, a Treasury spokesman said the changes were intended to incentivize non-DOMS “to bring money to the UK, encouraging them to spend and invest that money here”.
The statement added: “While we do not expect these changes to impact on the £33.8bn in tax revenue the OBR forecasts will be raised over five years, they reflect our ongoing engagement with stakeholders to ensure the reforms announced in the Budget work as intended Operation.”
The government’s October bench for non-doms forms part of wider measures targeting the upper echelons, with new taxes on private equity bosses, private schools, second homes and private jets.
Critics warned the move would inspire Exporting the super rich on a massive scale – Many of them will be key contributors to the government’s pro-investment agenda, they say.
An estimated 108 million people have left the UK, a 157% increase, according to the latest figures from global analytics firm New World Worles and investment immigration adviser Henley & Partners.
