The size of the change to the Temporary Repatriation Facility, a three-year scheme to help ex non-doms bring their assets to the UK at a discounted tax rate, was described as a “tweak” that would not be expected to significantly change the money raised from the overall policy.
Downing Street said the tweaks, which will be made through amendments to the Finance Bill, did not change the government’s overall approach “to replacing the outdated non-dom tax regime”.
The prime minister’s official spokesman said the new system “addresses unfairness in our tax system, attracts the best talent and investment to the UK and ensures that everyone who is a long-term resident of the UK pays their tax here”.
A Treasury spokesperson said the changes were not expected to impact the £33.8bn the policy is expected to raise over the next five years by the government’s independent forecaster.
“The Temporary Repatriation Facility is designed to encourage non-doms to bring their funds to the UK, encouraging them to spend and invest this money here,” the spokesperson added.
However, Conservative shadow chancellor Mel Stride said: “Labour’s Budget is falling apart in front of our eyes.
“At the election Labour said their plans would raise money, now they have been forced to admit their plans make the UK less attractive.
“But the damage is already done – tax revenue equivalent to hundreds of thousands of taxpayers has already been lost.”
The chancellor chose to announce the relaxation in Davos as part of a multipronged effort to show willingness to change policy to help economic growth.
On Wednesday she also set out changes to visas to allow top talent in Artificial Intelligence (AI) and medicines research to come to the UK.
Some in industry feel there is an opportunity for the UK to poach top talent in science and pharmaceuticals from the US under the new administration, and in AI from European Union.
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