I should state from the outset that I have problems accepting the credibility of anything STEPS says - why should I believe the word of an organisation committed to a lack of accountability and the promotion of tax havens, as it is? But having overcome this objection the claims they make are very obviously absurd.
Let's remember the purpose of this report: it is, they say, to assess whether there will be an exodus from the UK as a rest of the proposed change in the domicile laws, and a matching outflow of investment funds.
What did they find (when the hype is removed) is that just 4.5% of clients of the firms they surveyed will be leaving the UK soon. Now, remember that by definition non-doms do not have the UK as their permanent home. And remember that most are here on relatively short term secondments or postings with regard to their employment. And despite that only 4.5% are definitely leaving soon and 30% might leave sometime or might sell some investments as a result of the change to the domicile rule (or more likely, I'd say, that on capital gains tax).
Now let's put this another way. 95.5% are staying. Given that I'd expect at least 10% to leave a year as they're meant to be temporary residents I'd rate that as a massive endorsement of the new proposals. And given that right now I'd recommend anyone with serious wealth to be reviewing their portfolio for economic and capital gains tax reasons that fact that only 30% are suggests to me that 70% of these people may not be getting the advice you'd expect them to receive.
In other words, let's be clear. There is no serious adverse reaction likely to this new rule. Nor will there be a flood of outward investment, not least because those going will have no reason to sell out of the UK: they'll not be affected by changes to UK tax law such as CGT.
So the story is not just wrong - it's pure spin when in fact the domicile law changes are quite clearly being accepted by those who actually pay tax despite the likely fact that their STEP advisers have told them hell-fire and Armageddon are on their way. Those with calmer advisers are likely to be considerably more sober.
In which case let's be realistic: this change will be accepted and a few years hence we'll be able to consign domicile to the dustbin and no one will notice.