The Treasury is said to be reconsidering Labour’s plans to strengthen the abolition of the non-dom tax status, according to the BBC.
Treasury officials have reportedly claimed scrapping two concessions to the status made by the previous Conservative government might not raise the £1bn earmarked by Labour for school breakfast clubs and extra hospital and dental appointments.
Revenue from the plans was assessed to be uncertain by the Office for Budget Responsibility (OBR) earlier this year due to potential changes in behaviour.
A Treasury spokesperson told LabourList that reports that the non-dom tax status plans may be watered down are “speculation, not government policy”.
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The spokesperson said: “The independent OBR will certify the costings of all measures announced at the Budget in the usual way.
“We are committed to addressing unfairness in the tax system so we can raise the revenue to rebuild our public services.
“That is why we are removing the outdated non-dom tax regime and replacing it with a new internationally competitive residence-based regime focused on attracting the best talent and investment to the UK.”
It comes days after Rachel Reeves addressed Labour Party conference for the first time as Chancellor and said: “We will end the non-dom tax loopholes and we will crack down on tax avoidance and tax evasion. That is the difference a Labour government will make.”
The Labour manifesto totalled the revenue from closing non-dom tax loopholes and investment in reducing tax avoidance at £5.23bn in 2028/29. Just over £1bn of this would go towards funding 40,000 more operations, scans and appointments every week, with £855m for investment to reduce tax avoidance and £315m for free breakfast clubs in every primary school.
Recap on all of the news and debate from party conference 2024 by LabourList here.
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