West Palm Beach (HedgeCo.Net) – Ignoring intense pressure from businessmen and government officials over the past month, Alistair Darling has asserted that his tax plans for non-domiciled residents are here to stay and will be implemented starting in April.
In Wednesday’s budget meeting, the Chancellor of Britain informed the public that his plan to charge a flax tax of 30,000 pounds, or $59,000 USD on non-doms living in the UK for more than seven years, is here to stay.
The new structure, which will affect hedge fund managers, private equity firms, and other high-net individuals, has been attacked as of late, resulting from the fear that companies will close up shop and relocate in order to avoid the fiscal consequences of remaining in London.
Patrick Stevens, tax partner at Ernst & Young, said today’s “non announcement is a grave disappointment whose impact will be felt for many years to come.”
These tax changes, combined with the recent nationalisation of Northern Rock, along with increased amounts of government borrowing are all thought to have a major impact on whether the rest of the world will still view London as a preeminent financial center.
Darling, who seemed first to be persuaded, then later callous to the suggesitons, says that London will still be attractive for business. He also insisted that he will lift Britain out of their worst year since their last recession ended in 1992.
"Turbulence in global financial markets which started in the American mortgage market has affected all economies from the United States to Asia, as well as Europe,” Darling explained, before projecting growth of about 2% this year.
Julie Scuderi
Senior Editor for HedgeCo.Net
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