It’s fascinating to note that Simon Mckie has written in Taxation magazine saying:

The new non-domicile tax regime has been cobbled together and will be bad for UK plc

I’d have thought by now that those supporting the non-dom cause would have seen that the writing was on the wall, but apparently that’s not the case, even though Taxation magazines own editor, Mike Truman has said:

some non-domiciles have expressed the fear that this [the remittance basis changes announced in the Pre-Budget Report] may just be the start of a process which will lead to a removal of all their tax privileges; all I can say is that I hope their fears are realised.

Mckie thinks that ‘unsympathetic’ and then argues that non-doms deserve their special privelege for economic and moral reasons. His economic arguments are hackneyed, and already known, but in making his case he also says:

The significance of their charitable involvement in the provision of artworks for public display, for example, became obvious when lobbyists alerted the Government to the threat posed by its original proposals to heritage charities, which resulted in one of the Chancellor’s many u-turns.

To argue that the loan of artwork paid for out of untaxed income provides a reason for non-doms retaining their status is, I’d suggest pushing an argument beyond the parameters of the absurd. Mckie clearly doesn’t agree.

His moral argument is even poorer. He thinks the case of those like Mike Truman (and me) who argue against the domicile rule on moral grounds is:

the old view that it is better for everyone to be poorer provided they are less unequal; a belief in the virtue of equality of misery.

First of all this shows that he understands nothing of the other reasons for taxation, I noted here the other day. Second it shows he appreciates nothing of the impact of discrimination. Third it shows he does not understand that increasing disparities in wealth are harmful, causing economic decline due to disaffection from the system. Fourth, he appears indifferent to the concept of equality as the underpinning of democracy. But then, I’ve also heard that before recently as well. Fifth, he actually gives no evidence to support his claim that this outcome will result. Put simply therefore, he has not presented a moral case in defence of his position. He has presented a hackneyed rejection of what he perceives a socialist position. It’s a lame excuse for an argument.

And at the end what he presents is a ‘market based’ test for pricing tax for individual customers when they are important enough, suggesting that:

So, a more rational tax system for those with a weak connection with the UK would restrict the maximum tax liability of non-domiciliaries (or perhaps foreign citizens) to a modest amount (say, £5,000) and, after they have been resident for a short minimum period (say, three years,) provide that that liability would increase in smallish increments (say, £5,000) for each additional year of residence.

It’s absurd that such an argument can even be given space at this time when it has been shown that global capital and those who manage it are the cause of the current global financial crisis. In addition, as I showed recently, on pure economic grounds (using neo-classical argument) the distortions such arrangements introduce to a market will always be harmful to the smooth operation of markets, as we have too obviously seen.

Mckie’s argument can in that case be reduced to one single sentiment: greed on the part of clients. So unattractive is that that Mike Truman and I should be quite confident that the day when the domicile rule has gone will soon be here. And the likes of Mckie only increase the probability of that happening by advancing such ludicrous arguments that are so obviously abusive of the resident population of this country.