In this Taxcast episode we ask – do politicians believe in the societies they serve or not? Are they really a part of them, or do they live in a parallel world with different rules to ordinary people? The so-called ‘NonDom’ scandal goes all the way to Downing Street, the heart of the British government and the UK Chancellor/Finance Minister whose wife is taking advantage of an archaic tax status that leads to reduced taxes on her inherited fortune – just as her husband raises taxes on everyone else. Taxcast host Naomi Fowler explores the results of revealing new work on the data with economist Arun Advani of Warwick University: and co-author of a new report “The UK’s ‘non-doms’: Who are they, what do they do, and where do they live?’
Transcript of the podcast (some is automated)
“What we see is that we have a regime that explicitly encourages people not to bring their money onshore. And there are lots of other things in the system that need fixing. How does one get reform of these kinds on the agenda?“
~ Economist Arun Advani of Warwick University
“The nondom rule epitomises the sense of fracture of the social contract and the gradual erosion of commitment to democracy. And that’s why we need this whole new set of governing principles to re-establish some sense of a social contract here in Europe and elsewhere in the world where similar tax breaks have been given to the super rich.”
~ Economist John Christensen
- Economist Arun Advani of Warwick University, the Wealth Tax Commission and co-author of the report: The UK’s ‘non-doms’: Who are they, what do they do, and where do they live?
- Excerpt from a Taxcast interview with journalist and anti-corruption campaigner in Pakistan, Umar Cheema
- Economist John Christensen
- Taxcast host and producer Naomi Fowler
Further reading and listening:
- Report: The UK’s ‘non-doms’: Who are they, what do they do, and where do they live?
- Taxcast interview with journalist and anti-corruption campaigner in Pakistan, Umar Cheema, on his inspirational achievement in making Pakistan only the fourth country in the world to publish the tax returns of its Parliamentarians.
- The Wealth Tax Commission
- Article: Tax Legislation in the UK Benefits the Interests of the Rich
Summary of this month’s epsidoe of the Taxcast, with Naomi Fowler:
“We have oligarchs behaving badly, governments behaving badly – this time, the scandal goes all the way to Downing Street, the heart of the British government and the UK Chancellor – the Finance Minister – & his wife’s extraordinary wealth. We all knew she had enormous inherited wealth – £11.5 million a year in dividends from her stake in her father’s IT business, based in India. But it turns out she opted to minimise her taxes using an archaic status to do so – she’s a nondom. So, what is a non-dom?
‘Non-dom’ status refers to a person who is not domiciled in the UK. That doesn’t mean they don’t live in the UK, it means that if one of their parents was born overseas they can choose to claim this status – which saves them lots of tax. The UK Finance Minister’s wife could well be avoiding 2 to 5 million a year in taxes because of the nondom status she’s opted for. Unlike most UK residents, nondoms don’t pay UK tax on their worldwide income and capital gains. (If you’ve got any worldwide income!)
The outrage of even this Conservative MP in this Parliamentary Committee hearing pretty much sums up the anger of voters – bear in mind it’s his party’s Finance Minister’s wife – just as her husband is currently raising taxes on the poorest people especially, as they face a cost of living crisis:”
“I mean it’s extraordinary, frankly. And you wonder why people –“
“It’s a policy issue –“
“Yeah, I know it’s a policy issue and it’s nothing to do with you, you’re just the bloke in charge, I realise that, but in all honesty you’re surprised that people think there’s one set of rules for rich people and one set of rules for someone else, when you’ve just told us that that’s exactly what there is!”
Naomi: “Not only that but both the Finance Minister and his wealthy wife “pledged permanent residence” to the United States as “Green Card” holders, while he was a Member of Parliament and Finance Minister. I mean, we can legitimately ask – do politicians and their families believe in the societies they serve – or not? Are they a part of it? Or not? So far in the UK, only 5 of the 22 cabinet ministers are willing to confirm publicly whether they or their families benefit either from offshore holdings or from non dom status. Back in 2015 I interviewed the amazing, award winning journalist and tax justice campaigner from Pakistan, Umar Cheema. We spoke about his inspirational achievement in making Pakistan only the fourth country in the world to publish the tax returns of its Parliamentarians. This is what he told me at the time:”
Umar Cheema: “Interestingly, a senior Finance Ministry official told me that when the government of Pakistan decided to make tax data public, they got to hear from the UK authorities that now we will come under pressure to do the same in the UK. I don’t know when they do, but one should hope for the best and the Tax Justice Network must use the example of Pakistan for pressuring the authorities in London.”
Naomi: “Ha! Britain today, and many other nations are still light years away from following Pakistan’s example and putting the tax affairs of their elected representatives into the spotlight. I’m going to speak with one of the co-authors of a new report which for the first time, unmasks the kind of people who are using this archaic non dom status in the UK – they released their report just as the scandal about the finance minster’s wife broke, happy timing to get major attention on to something fundamentally unjust. But first I’m going to speak with economist John Christensen.”
Naomi: “OK John, nondom status is something we’ve spoken about quite a few times on the Taxcast and as is so often the case with these things this is yet another example of how oligarchs behave, and we can apply that term to all the super rich, it doesn’t just apply to Russians – they just live in a parallel universe where taxation applied to ordinary people doesn’t apply to them, and borders don’t apply to them. Now it looks like the UK finance minister’s wife, the chancellor’s wife has pretty much damaged her husband’s political career because there’s a lot of anger from ordinary people about the hypocrisy of tax minimisation by the family of the man who’s setting our tax policy in the UK and has done absolutely nothing to help citizens in the cost of living crisis they face. She’s now said she’ll pay tax voluntarily in the UK. And it’s important to make clear that she can say hand on heart, that she’s paying all taxes that are due completely legally, partly through her non dom status, but also interestingly, she’s got the payouts on her huge inherited wealth routed..through the tax haven of Mauritius, so she’s likely to be paying zero tax there, and this is very much what we call unearned income, so that’s a thing that’s so undertaxed compared to what we all work to earn.”
John: “Yeah, so look, we’ve discussed the non dom rules many times, and we’ve also campaigned for its abolition, but bear in mind the following: firstly, domicile has nothing to do with citizenship. You can hold an Indian passport as Ms. Murthy does, but live and work in London and pay UK taxes on your income. Secondly, being non domicile is a personal choice. You actually need to apply to her Majesty’s revenue and customs to be deemed to be non domiciled in the UK. And equally, if you want to pay taxes in the UK in the same way as the vast majority of ordinary people do, then you can give up your non dom status and you can do this without in any way undermining your Indian citizenship. And thirdly, when Ms Murthy’s spokesperson claims as they did that, she has been paying all the taxes used legally liable to pay, this statement needs to be unbundled very carefully, indeed, because it is almost certain that most people won’t understand the implications of being of what is being said, because most people are used to being taxed on pay as you earn basis, and they don’t receive unearned income from wealth held in an offshore holding company! So, in light of the scandal that blew up especially after her husband went ahead with increasing the national insurance contribution rates, which apply to most workers, Ms. Murthy has reportedly chosen to give up her nondom status and will henceforth be paying UK tax on all her worldwide income. But unfortunately for her and for her husband, the reputational harm caused when her non dom status was revealed is probably irreversible and her husband’s long held ambition to be prime minister of the United Kingdom has probably been hulled below the waterline. That’s because if there’s something the wider public really hate, it’s the notion that there’s one rule for super rich people and another rule entirely for ordinary people.”
Naomi: “Yeah. And especially while he was raising taxes on everybody else!”
Naomi: “So, the UK’s kind of really archaic nondom status has influenced other nations, I mean, Italy, where I am at the moment, they introduced something that was inspired by the UK, just as, at the same time political opposition in the UK did actually persuade the government to scale it back a bit. Um, and I do mean a bit, uh, because they put a 15 year time limit on it and they made it more expensive after a while, so the cost of 30,000 pounds a year fee, which is over 37 and a half thousand dollars a year to 60,000 pounds a year, and that’s about $75,000 a year. Um, again, more than most of us earn in a full year, so it’s obviously well worth it for these nondoms, um, and tax havens elsewhere also have all kinds of unjustifiable assorted advantages, and really all of this means that we must redefine the principles that should govern us all equally, right?”
John: “Oh, absolutely because you see, the nondom rule and the equivalent rules in many other countries come out of a particular ideology, a tax haven ideology, and it’s worth just to look at that ideology and understand why politicians think it’s worthwhile targeting tax breaks at the super rich people. The argument goes that super rich people are super mobile. They can choose to locate themselves anywhere Monaco one month, Palm Beach the next, they choose to locate their financial assets and their wealth anywhere, Cayman islands, Mauritius, wherever. So paying tax for the super rich is entirely a voluntary matter. There’s a perceptible public sense that the rules essentially the tax rules are biased to the interests of the very wealthiest people in society and the wider public, especially in Britain, but I think the same can be said in Italy and in France, are paying high levels of tax whilst receiving increasingly poor quality of public services. So the nondom rule, as far as I’m concerned, epitomises the sense of fracture of the social contract and the gradual erosion of people’s commitment to democracy. And that’s why we need this whole new set of governing principles to re-establish some sense of a social contract here in Europe and elsewhere in the world where similar tax breaks have been given to the super rich.”
Naomi: “Yeah. And what – definitely – and what governments everywhere always say to justify these kinds of privileges for the very wealthy is it encourages investment. And, uh, I’m gonna speak in a minute to the co-author of a really important report on nondom status about how much that really is a load of nonsense, but when it comes to the term investment, that’s a really, really tricky word, isn’t it? Because actually, well, it’s worthy of an entire Taxcast in itself, which is something I’ve intended to do for a while.”
John: “Yeah, well, the word investment as far as I’m concerned, it’s just a catch-all word used by lazy economists and politicians to confuse the public and obfuscate. As far as I’m concerned, much of what is termed investment, particularly inward investment doesn’t flow into new facilities or researching new technologies. Instead it goes into acquiring or merging with existing businesses, often leading to job cuts and often consolidating the market power of major companies, who might already have monopolistic powers in that market. So, yeah, absolutely, let’s go ahead, let’s have that edition of the Taxcast, let’s discuss this matter because we need to bring pressure to bear on the economists and national statisticians who provide the data on so-called investments, which we need to have a much better understanding of whether all these tax breaks to super rich people are actually leading to real investment in new jobs and new ideas and new services. Are they actually helping just the super rich and everyone apart from the super rich find their situation being eroded by the lack of investment into new wealth creating activities?”
Naomi: “Thanks John! Economist John Christensen. Now it’s time for the Taxcast special feature. The UK’s ‘non-doms’: Who are they, what do they do, and where do they live? What does it tell us about wealth and fairness? Now we have a new report just out – for the first time the data on nondoms has been mined by a team of economists and data specialists. We now have a picture of the UK’s ‘non-doms’ – these are people who are paying a nondom fee from £30,000 to £60,000 a year – that’s more than most of us earn in an entire year. It helps us definitively answer the question – what is the point of nondom status? Who does it serve? I’m speaking to Arun Advani of the University of Warwick, one of the report’s authors. So, hi Arun, so the most obvious question is how do you get non dom status?”
Arun: “You’re non dom just as a fact of your existence so you either are, or aren’t a non dom and that just is a function of whether your permanent home is the UK or not the UK. So if you were born here, brought up here to a British parent and you expect to live here the rest of your life, you’re a UK domiciled person. This, this is your permanent home. If however, you come from another country and you intend potentially to go back there, then you would be a non dom, and that will apply to, you know, many, many people.
Then there’s the separate question that’s been coming up recently which is about whether you are sort of a non-dom for tax purposes and this is really a question about whether you choose to tick a box on the tax form that says, ‘I wish to benefit from the remittance basis,’ which is a particular status that you get if you’re a non dom. So if you’re a UK Dom, you don’t have the option of that box, but if you’re a non dom, you can tick that box and ticking that box says, ‘I don’t have to declare or pay tax on foreign investment income until such time as I bring that income into the UK. And if I never bring that income into the UK, then I will never pay tax on that income.’ And so that’s kind of what all the recent debate has been about has been about, has been there are people who tick a box on the tax form that gives them this particular benefit that says, ‘if I keep my income from investments offshore, I won’t have to be paying tax on it in the UK. And potentially I may not be paying tax on it anywhere in the world.’”
Naomi: “Right, it’s the first time that the data on non doms has been analysed like this in, in Britain, so I, I just wanted to ask you, if you can describe the data that you’ve had access to, the data you used and why you wanted to do this?”
Arun: “So the data that we are using is from the UK tax authority, we go and sit in a secured room in the what’s called the data lab in her majesty revenue and customs and sitting in that secure room where we have no access to our phones or computers or anything else, uh, of our own computers. We can use a secured set of computers that give us access to completely anonymised data. So I can’t see anything about individuals in their personal capacities, their names or dates of birth or anything like that, but I can see anonymised data on all of the details you’d basically see on the tax form so I can see what they filed as their level of income and what all of those, like sub-components on different boxes of the tax form are. So that’s what we can see.”
Naomi: “And why did you want to analyse this data?”
Arun: “At the beginning of the pandemic, there was a bit of a debate around wealth taxes and whether they would be the answer to what is going on in the pandemic and how we’d pay for it. And we had questions from journalists asking us, you know, what do we think? We felt that we ought to have an answer and we didn’t have a good answer to that question, didn’t think we knew the answer and so we set up the Wealth Tax Commission to go and study the kind of broader question about wealth taxes. Uh, and when we were doing that, you know, one of the areas that was most striking to us was we just really didn’t have very good evidence on what goes on at the very top of the income distribution and we have basically no information about wealth because the UK doesn’t tax wealth directly and so we don’t store any information on this. And that seems like a bit of a policy gap because you can’t really answer questions, like what would happen if you did this or did that to wealthy people, if you don’t have evidence on it. And as I say, these data are really nice because they, they are, you know, data for every single person in the tax system in the country, so it gives you the chance to kind of try and explore some of these big questions we wanted to understand a bit more about the non doms and this first piece was really trying to understand just who are they, like, what kind of people are benefiting from the system? You know, their ages, their, their sex, where they come from, uh, where they live in the UK, what are they doing in the UK? Those were the first questions we wanted to understand what is the total benefit they’re getting, how would they respond if we were to reform the system and do they do brilliant stuff in terms creating jobs, or do they have really negative effects on house prices? We don’t know right now, we’d love to know that. And once we understand the answer to that kind of question, we can then think overall collectively about, you know, what would a sensible policy look like in this area.”
Naomi: “Lots of really important questions, incredible how little data we have in the UK on wealth. Here are some nuggets from the findings of this new report The UK’s NonDoms: Who are they, what do they do, and where do they live? You’ll find the link in the show notes. So, here you go: [Sale of the Century music]
- Three in ten people who earned £5 million or more claimed non-dom status in 2018.
- More than one in five top earning bankers is a non-dom.
- Most non-doms are men.
- Non-doms are highly represented in finance and ‘City’ jobs.
- Most non-doms come from Western Europe, India, and the US. Since 2001, there’s been a rapid rise in the number of non-doms from India, China and the former Soviet states.
- And most non-doms live in and around London, in the most expensive districts.
There’s lots more, I really encourage you to read the report. So Arun, what surprised you the most about your findings? I mean, for me, what surprised me a lot was the answer to one of your many great questions in the report, which was, are nondoms workers or rentiers? And it turns out around 80% of non doms, as you say in the report have got earnings from some kind of work or pension income as their main source of income. That means a lot of them seem to be engaged in substantial paid work, that is interesting. I also realise that there are caveats around that because the data you’ve looked at are based on reported income only and it likely underestimates total income, given that a key, one of the benefits of nondom status is that they don’t have to report or pay tax on their foreign-source income unless it comes into the UK, one of the unknowables. But yes, I kind of pictured someone not doing very much, sitting in their jacuzzi quaffing champagne – but many are actually working.”
Arun: “Yeah, that’s one of my top three. And I think so the, the finding, as you say, is that, you know, 80% of them have in the income that they declare, uh, the main source of income is some kind of work or, you know, in a small number of cases pensions and I guess that that kind of is different to what people have in their mind of someone coming here, you know, an oligarch or whatever who lives off some big foreign investment income wealth in the most part, it’s not people who are coming here and sitting on their bum, living off that foreign income, they may well also have lots of that foreign income, but they’re also here and doing something here, they’re in the labour market, they are working.
The second thing sort of related to that work issue is, you know, what are they doing? What kinds of work are they doing? And the biggest group are in banking, which, you know, maybe people aren’t surprised at, you know, finance is where there’s lots of money in the UK, and we’re not surprised these people are well off, but I think I was surprised by the scale of it, so one in five people working in a bank who are in the top 1% basically, and earning more than 125,000 pounds, one in five of those are non doms.
And then the third thing that I found really striking was when we did this kind of, uh, geographic picture of where people are, one of the areas that lit up was Manchester, so we thought thought, wow, what’s going on in Manchester? And you see that there’s these very young people in Manchester who are in the sports industry who are nondoms. And I think a sort of youngish footballer is probably not what I would’ve first thought of as a major kind of group of non doms. And there aren’t loads of them, there aren’t a huge number of them as you kind of can imagine from the size of the teams that are out there, as I say we don’t know who any of the individuals are but..given that they’re in Manchester and they’re, uh, nondoms and they’re in sports is probably that they’re footballers. Um, but you’ll also see they’ve very high incomes. Their kind of average incomes for those non doms are about 2 million pounds. So that’s, that’s really high. And then again..that’s not including any foreign investment income they may have. So I think that was kind of my third really striking thing was just this type of people that I hadn’t really imagined who are out there.”
Naomi: “That’s interesting. And I mean, in terms of the typical profile of non doms, I mean, we have to generalise quite a bit obviously, but it’s really interesting. It’s a lot younger than I thought it might be that, uh, you know, you say that the, the, uh, age bracket is, has a tendency to be late thirties to early forties. And, uh, not surprisingly to me, uh, most of the are men, there was only under 35% of nondoms are women.”
Arun: “Yeah so having started with, you know, here are the ones that are not the typical ones, here are the ones I found surprising, the typical nondom is that kind of man you might picture, as you say, you know, about a third of them are women, about two thirds are men, which actually is a slightly higher ratio of women than you’d expect for just if you took generally high income people, so there are slightly more women in that group. They’re, you know, middle aged, in work, probably in some kind of City job so most likely in finance, something like banking, but also working in consultancy, work in other kinds of support services that relate to banking, finance business type things in the City. And yeah, and they’re living in the Southeast, they’re living in, in London or the surrounding areas.”
Naomi: (Chuckles) “And the actual proportion of people that we’re talking about here whilst it’s a tiny proportion, I, I think you, you said, uh, 490,000 unique individuals who have claimed non dom status, uh, from 2001 to 2018 while being UK resident, uh, at some point, that total, that’s 1% equivalent of all UK adults, but they do have a disproportionately large impact in terms of these tax based decisions – and I’m assuming that they’re tax based decisions they made to claim nondom status with the tax authorities. And there’s a lot of sort of unknowable questions that your research raises. Right? Um, what, what sort of things do we not know? I mean, in terms of the impact to the UK, we know they paid over 7 million, uh, in 2020 – 7 million pounds in income tax, capital gains, national insurance. And that doesn’t seem very much to me!”
Arun: “Yes, I mean I think there’s big questions to ask – just how much tax would there be in a world in which every nondom who was currently in the country had to stay in the country and you could just work out how much tax sort of would they pay if they paid the same taxes as everybody else? The really hard bit is actually just to get a sense for what is the tax base, how much money is there out there that is potentially taxable? If you were to change the tax system in some way, just how will people respond? But because we don’t even ask what is the income that you are not having to pay tax on, what are the gains that you’re not paying tax on? Because we don’t even ask that question we don’t even know what is that basis, it’s really hard to have an informed policy discussion, or, you know, if you were a minister and right now you were going to ask the tax authority to tell you, well, what is the effect of doing this reform? You know, how much money’s out there, I think they could go and do some of the things that we are going to try and do, which is to do complicated ways to estimate what that would look like, but it would be much simpler if it was just on a form somewhere, like it is for most things where you can say, okay, here’s how much money there is out here, and this is what we can kind of get.
And then, having answered how much money’s out there, the third question is what are the other effects that that has on the economy? Is it the case that it will lead to, to slower growth or will it help bring down house prices or will it change how dynamic companies are, will it change the number of patents we produce, all of those other economic questions we’d quite like to know the answer to, beyond just, beyond the tax benefit and it’s not clear, you know, whether there are those kind of big effects.”
Naomi: “Yeah, exactly, because I mean the argument is that for the nation, it brings in investment, which you wouldn’t otherwise get, but, but that word ‘investment’ is such a tricky one, because if it’s investment in something like the productive economy, or if it’s investment in terms of speculative or in property or other investments that aren’t necessarily gonna bring much benefits to the UK, it’s another kind of unknowable question, but I read that in 2019, the government says that non doms ‘invested’ over a million pounds in the UK, which again, doesn’t sound like very much!”
Arun: “Well, and I think the other thing that’s worth remembering in the context of the non dom policy, is that what the policy does in its current form on, on remittance basis, which is this, this tax benefit you get, is it says, ‘if you come to the UK, we’ll give you a tax benefit. And that tax benefit is on overseas investment income.’ So if you have lots of wealth, that’s generating lots of income, as long as you promise to keep it overseas and not bring it into the UK, we will give you a tax break. So if what you were trying to do is to bring investment into the UK, by bringing wealth into the UK and having people invest in kind of productive stuff here, this is absolutely not the way to do it. This is encouraging people who have lots of wealth to come to the UK and to not bring their wealth to the UK. And if they were to bring their wealth to the UK, then they will not get this benefit. There are, you know, I should say at this point for the, for the legally minded people who are listening, there is something called business investment relief in principle that does provide a way in which people could still retain some of the benefit, because it’s clear that this is a completely mad system, but it’s so hard to use business investment relief, when you look at the statistics, you can see that basically no one is using it. It’s just too hard to use it, and nobody, uh, kind of tries, it’s just easier to keep your money offshore. Uh, and so what we see is that we have a regime that explicitly encourages people not to bring their money onshore.”
Naomi: “Right! Which begs the question, what is the point?!”
Arun: “Yeah, and I mean, it’s also, I think it is a good point to also reflect on the fact that the nondom regime shouldn’t be thought of as something that was designed in the sense that the remittance basis, which is the thing that lets you have delayed to not pay tax on your overseas income is a, you know, colonial era thing. It was invented in 1799 around the same time as the income tax. And it basically said, look, if you have income that you get from overseas, you know, in the old days back in, uh, you know, colonial times, you have something, you know, sugar plantation in the Caribbean or something, you don’t have to pay income tax on that income the moment it arises, that is the point at which that income exists. We’ll wait until the point at which you bring it onshore because in the, in those days to trade that sugar or whatever else it was, you were trading, you’d have to bring it into to Liverpool or some other dock in the UK. You’d have to bring it onshore before you could send it back out to somewhere else, to some other colony. And so it was just a deferral of tax. We would not charge it to you yet. We’ll charge it to you at the point that money comes onshore when you have access to actually touch it. And in the off chance that, you know, the, the ship sinks or something, then you’re never gonna pay that tax because you never got, you never really got the income. So that, you know, there’s some rationale to that. Then over time, there were loads of reforms that kind narrowed the scope of doing that, and eventually, you know, much later, made it the case that not everyone could benefit from this ability to keep this money offshore, only people who were non doms could have this benefit. So originally the remittance basis, which is this overseas income isn’t taxed at the point that it arises, it was taxed only when it comes onshore, that was available to everybody. Then that later got narrowed down to just people who are not domiciled in the UK, but also over time, as we know, the world has changed, it’s no longer the case that this is a tax deferral policy. It’s not the case that we’re just deferring that tax till some later date, when the money comes onshore. Now people can benefit from that money without ever bringing it onshore. And so it’s no longer deferring the taxes now, just saying you could get away with never paying that tax..It’s also just not the case that it’s doing any specific thing that we would currently set down as a goal that policy has. Like, if you start from first principles and say, ‘I have a goal for policy, which is to bring in brilliant, smart, bright people who can come and work in the UK and to bring in people who have loads of money who can bring it in and can invest in the UK,’ then this policy is not doing that because it’s both in that second case, telling people don’t bring that money into the UK. And in that first case, it’s not clear that this is the best way you want to encourage those people to come into the UK, because it’s in fact saying to those people ‘come here, but make sure that in your hearts, you keep in mind that you don’t want to stay here forever. Cause if you come here and you decide that you actually want to stay here and you’d like living here, and this is where you think your permanent home is quite quickly, then you no longer benefit from this regime. So you’d better believe that your permanent home is some other country,’ which again, you know, if you think these people are brilliant and are doing great stuff here, why discourage them in that way, that says, you know, we, we hope that you are not making a permanent home in the UK. We hope you’ll just settling for a little while. It was not designed for these goals, but if these are the goals you’re trying to have, this policy is not achieving them.”
Naomi: “No. I mean, it’s a completely illogical, one of many illogical colonial overhangs which doesn’t make any sense now. Unless you’re wealthy, powerful and happy to take these unfair advantages – in terms of attracting ‘brilliant’ people, in the case of the UK Finance Minister’s wife, as far as I know there’s no entrepreneurial brilliance on her part, she just inherited a stake in her dad’s IT business based in India. And the last time I checked, in Britain, only 5 of the 22 cabinet ministers are willing to confirm publicly whether they or their families benefit either from offshore holdings or from non dom status. I mean, you surely think non dom status should end?”
Arun: “Yeah, I do think that nondom, the domicile as a concept, doesn’t have a place in the tax system. And there are lots of other things in the system that need fixing. We happened to get really lucky this time that there was this big news story that, you know, with the most ridiculous timing broke right close to when we were trying to release our stuff, but more broadly, how does one get reform of these kinds on the agenda? Because they are niche, they are boring, they are technical. Most people don’t know anything about them, journalists mostly don’t have any reason to think about them, and are going to find it hard to sell to their editor that this should make an important news story and so in that environment, how do you fix those things? You know, there’s all those other things that are out there that we need to make sure that people are thinking about. And just because there’s no news story about them right now, they don’t get ignored for, you know, 10 years until there happens to be a new story and then they get dealt with, we need people to be thinking about them right now.”
Naomi: “Oh he’s singing the song of the tax justice movement…but all this boring, technical, ‘niche’ stuff – fair taxes – is the life blood of our nations – we’ve GOT to care about it! The political opposition in the UK has proposed abolishing nondom status, which is good news that finally this illogical perk of the very wealthy might end. So many other perks need to go with it too, not least the secrecy that protects the rich from fair taxes we all contribute. Join me next month on the Taxcast for the results of the latest 2022 Tax Justice Network Financial Secrecy Index, and hear how badly your country ranks as a global secrecy offender…Thanks for listening, bye for now.”