Osborne really said…..

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Daylight is beginning to break on what George Osborne's plans for the non-domiciled are.

I gather that there will be no change in the non-dom rules at all. Except that the ten year review of a non-dom person's status won't happened, so once non-dommed you can have it forever.

But otherwise everything is as before. The remittance rules apply. All the issues associated with them will stay. All the planning opportunities will remain. You'll just have to pay £25,000 to use them.

So what we would then have is a non-dom rule that wasn't actually anything to do with domicile, but an awful lot to do with wealth. Because no one is rationally going top ask for non-dom status unless they can save £25,000 a year in tax - which means they've got to have £62,500 of income offshore at current top income tax rates.

Now, using the logic and data I've been referring to all day this means that compared to average tax payments now by non-doms those earnings less than at least £150,000 (worldwide) probably won't apply for the status anymore. It won't pay them. Give or take (and this will alway be the case) I guess that means, to use the same logic 73% of them will give up the claim and pay about £14,700 each extra tax as a result. That's £1.2 billion.

And then those for whom the claim will remain worthwhile will pay £25,000 each. There will be about 30,000 of them, so that's an additional £0.75 billion.

So, he could raise nearly £2 billion in tax doing this.

But why abolish the non-dom rule for the (relatively) lower paid and keep it for the outright rich? What's the point of that when using my data I show that abolishing it altogether, removing on the way rafts of tax law, aiding simplicity and creating democratic tax justice would raise £4.3 billion?

Just what is it about those 30,000 people that means they need a tax subsidy of £2.3 billion or a bit over £75,000 each? Give us the answer George. And don't say you're frightened they'll leave. Fear isn't attractive in a politician. Give us a logical answer, if you can. Or give up this blatant sop to the rich, once and for all.

And use the proceeds to end child poverty, not to provide housing subsidy for those who have enough income to qualify for a mortgage these days. Because that would really showed you cared - about more than votes.

PS: (3-10-07) The Independent was also confused.

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