Lord Jones criticises tax plans
Lord Digby Jones, the trade and investment minister, has warned plans for a tax crackdown on non-domiciled foreigners living in the UK could threaten London’s status as a world finance centre.
In an interview with the Financial Times the minister claimed members of the financial services had expressed concerns over the plans.
Lord Jones said that with the proposed tax changes it was becoming harder for him to sell Britain as a location for skilled foreign workers and inward investment.
“I can give you five reasons as to why you should invest in Britain before you go and invest anywhere else in Europe,” he said.
“But maybe there were seven and now there are five.”
The former CBI director-general claimed that the tax plans may lead to the UK losing its “badge as the place to come and bring your skill and work hard in the developed world”.
“It has caused people to say ‘Does this mean they don’t want us?'”, he added.
The Treasury is currently consulting on proposals to raise an extra £650 million a year by charging foreigners who live in Britain for over seven years £30,000 annually if they want to keep their foreign income out of the UK tax net.
Lord Jones was brought into Gordon Brown’s “government of all the talents” in the summer and his promotion sparked controversy as he has failed to fully endorse Labour policy.
In response to the comments, TUC general secretary Brendan Barber said: “He must make up his mind whether he is a member of the government or a business lobbyist.
“The truth is that these extremely modest proposals to make non-doms pay a flat charge for their tax avoidance will have little impact on the super-rich.”
David Lewis, lord mayor of London, told the chancellor Alistair Darling earlier this week that there was considerable anxiety within the financial community over the plans.
“Many people cannot understand why we are risking the loss of so many talented people from the UK who produce so much business for the UK and so much tax fro the Treasury and employ large numbers of staff here, for the sake of the possibility of a relatively paltry tax receipt by the Treasury that it will probably never actually receive,” he claimed.