So Gordon Brown, the accident-prone British Prime Minister, has seen some light on the vexed question of non-domicile taxation. He and his Chancellor, Alistair Darling, have been threatening to impose a £30,000 (Dh219,000) annual charge on all those “nondoms” who under existing legislation have no obligation to pay UK tax, which can reach 40 per cent of income. Now they have sweetened the package a little, and promised not to snoop any further into nondom’s affairs when they pay up.
I fear it will not be enough to stop the mass exit of entrepreneurs many observers are expecting when the new rules are imposed later this year. The new policy was always a politically motivated bit of financial engineering, which the British Government admitted would only bring in something like £600 million a year in revenue for the government.
Those same people are the ones who bring cash into Britain, start businesses, are dynamic, entrepreneurial employers, and who have also kept the British property market at its current inflated levels.
But where will they all go? There is long list of destinations in Europe – Switzerland and Monaco for example – that welcomes independent entrepreneurs and does not penalise their initiatives. But I suspect some of the imminent British exiles will be heading to the UAE, and Dubai in particular.
These people will be welcomed here as long as they work hard and respect local cultural traditions. In fact, they will probably feel more at home here than they currently do in Brown’s overtaxed, over-regulated little country.
Gordon Brown’s tax exiles could be Dubai’s gain