|
London: UK plans for a tax clampdown on wealthy foreigners may prompt an exodus of many South Asians living in Britain, a poll by accounting firm Grant Thornton shows.
Forty-two per cent of rich Indians, Pakistanis, Sri Lankans and Bangla-deshis not domiciled in the UK are preparing to leave because of a proposed annual charge to escape tax on their overseas income, according to the survey of 50 such people.
Hefty charge
Nearly 84 per cent said the £30,000 ($58,861) charge is set at an unfair rate and 78 per cent said they didn't have enough time to prepare for the changes.
Only 34 per cent said they would be prepared to pay the new fee, Grant Thornton said.
"The government must appreciate that in 20 or 30 years it may be Singapore, Dubai or Zurich that will be home to a vast swathe of non-doms who could have been here," Grant Thornton Partner Anuj Chande said in an e-mailed statement.
Starting in April, the Treasury intends to levy the charge on non-domiciled foreigners who have lived in the UK for more than seven years or require them to declare their worldwide income to the tax authorities.
Amid warnings that the plan risked sending wealth creators abroad and damaging Britain's standing as a financial centre, Chancellor of Exchequer Alistair Darling last week promised not to probe into the overseas earnings of non-domiciled workers if they choose to pay the levy instead. He rejected business calls to delay the plan by a year.
Opposition view
The main opposition Conservative Party has characterised the move as a retreat over a key plank of government tax policy.
The government estimates that around 115,000 people living in Britain are non-domiciled, a status that allows them to avoid tax on investments and income earned abroad.
Among them is Indian-born Lakshmi Mittal, the world's fifth-richest man
Investment: US plans treaties
The US government is in preliminary talks to establish investment treaties with countries including China, Russia and India, the Treasury's top international adviser said.
"US firms are already investing in these three markets at a rate two-and-a-half times that with the rest of the world," David McCormick, the US Treasury's undersecretary for international affairs, said on Saturday in prepared remarks at Dartmouth College in Hanover, New Hampshire.
Such agreements are an important next step to protect these existing investments.
In the speech, McCormick said "exploratory discussions" are under way to forge "bilateral investment treaties" with three of the fastest-growing emerging economies.
US investment in China, Russia and India rose to $41.1 billion in 2006, from $15.4 billion in 2001, he said.
By signing such agreements with the US, a country sends "a clear message that it welcomes US investment and is prepared to stand by enforceable commitments to an open investment regime," McCormick said, adding that US has signed the treaties with 40 countries.
- Bloomberg
|
