Footballers ‘will leave’ if non-dom tax perk ditched

SCRAPPING the non-dom tax regime could cost the Treasury £5billion in revenue, reduce GDP and prompt dozens of top Premier League footballers to leave the country, warns an analysis.

The study by an independent group of international economists says such a move by Chancellor Jeremy Hunt in the Budget would be ‘highly risky’.

Non- domiciled status allows foreign nationals who live in Britain but are officially domiciled abroad to avoid paying UK taxes on their overseas income or capital gains.

They still have to pay taxes on their earnings in the UK. Prime Minister Rishi Sunak’s wife Akshata Murty has previously enjoyed nondom status.

The report from the Growth Commission comes as Mr Hunt is thought to be considering scrapping the regime as he looks for ways to pay for tax cuts elsewhere.

Such a move would also serve the

‘Loss of £5billion in revenues’

double purpose of taking one of Labour’s main policies, with the money earmarked for many of the Opposition’s spending plans.

Labour has previously backed the idea, saying it would raise up to £2billion.

The report calculates that the estimated 68,000 non- doms in Britain currently pay £12.4billion a year in UK tax and contribute £46billion to gross domestic product (GDP), a measure of the size of the economy.

A large portion of this group would leave if the policy was scrapped, argues the study.

That would result in a fall in the income taxes they pay, with a further decrease caused by the drop in the size of the economy.

Overall, it estimates a loss of £5billion in tax revenues and 0.5 per cent in GDP a year.

The worst affected would be ‘footloose’ industries. These employ people who can move easily between countries and include banking, oil, car production and football, the research said. About a fifth of bankers take advantage of the nondom regime and an estimated 371 footballers have that status.

In one analysis, as many as 205 of those players could leave if it were to be scrapped.

But given the limited opportunities to earn high Premier League level wages in other countries, this is likely to be limited to between 50 and 80, including about 20 of the game’s top stars. Douglas McWilliams, deputy chairman of the Centre for Economics and Business Research, who led the study, said: ‘One of the best rules of taxation is for tax authorities not to be too greedy.

‘Given the amount of revenue that the UK tax authorities currently earn from non- doms, it would seem highly risky to abolish non-dom status.’