The TUC and the domicile rule

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There's good coverage for the TUC's backing of the campaign to abolish the domicile rule, launched yesterday.

The Independent heads their report:

Close tax loophole to help poor children

And notes:

The TUC warned yesterday that high earners "float free from society" and contribute to the growing gap between rich and poor in Britain. Brendan Barber, the TUC general secretary, called on Gordon Brown to end non-domiciliary status, which benefits foreign business people living in Britain, and demanded that he abolish controversial tax reliefs for private equity firms.

The FT says:

The TUC launched a campaign on Sunday aimed at closing non-domicile tax loopholes which, it said, could raise £4bn to tackle child poverty and the housing crisis. "A significant group of super rich float free from the rest of society and think tax is for the little people," said Brendan Barber, the TUC general secretary.

Whilst the Guardian reports:

[T]he [TUC] launched a campaign calling for the abolition of rules allowing rich people regarded as not domiciled in the UK to avoid paying UK tax.

Research by the Trades Union Congress, which is meeting in Brighton for its annual conference, showed Britain would be £4bn better off if the rules were changed. TUC general secretary Brendan Barber said: "Today a significant group of super-rich float free from the rest of society and think that tax is for the little people. The super-rich distort the housing market, with house prices following top pay, not average pay.

"The gap harms social cohesion - and without joining the moral panic about crime rates in the UK, it's noticeable that many countries with a fairer distribution of income have lower crime rates."

Revenue raised by eliminating the domiciliary status loophole could be used to eliminate child poverty, the TUC argued.

But perhaps Reuters summarises it best:

BRIGHTON (Reuters) - Britain could meet its goal to halve child poverty by 2010 if it closed a loophole that allows more than 100,000 high earners to avoid paying tax on their overseas income, the Trades Union Congress said on Sunday.

Child poverty costs each person in Britain an estimated 600 pounds per year, and improving conditions for the poor will require about 4 billion pounds per year through extra benefits and tax credits.

"Ending the widespread abuse of the non-domiciliary tax break ... and replacing it with a proper test of residency, on conservative estimates, can easily raise four billion pounds a year." TUC chief Brendan Barber told reporters in Brighton

I'm pleased to have been able to supply that estimate. I'm as pleased with the use being made of it: linking the domicile rule and child poverty seems to me to make clear the obvious fact that tax abuse costs real people real money, money that could be used to improve the real lives of many at limited cost to few.

That's tax justice.