Non-dom perks go... as Rishi misses talks because of his wife

THE non-dom tax status will be abolished, the Chancellor announced yesterday – a perk for which Rishi Sunak’s wife previously qualified.

Stealing one of Labour’s main policy offerings, Jeremy Hunt announced that those with the ‘broadest shoulders’ would pay more from next year, raising £2.7billion for tax cuts.

The Prime Minister was recused from the discussions about the policy due to his Indian-born wife, Akshata Murty, previously being one of the UK’s most high-profile non-doms.

Non-domiciled people live in the UK but have their home overseas for tax purposes and do not pay UK tax on money they make elsewhere.

Labour has consistently attacked Mr Sunak over his wife’s tax status and has pledged to abolish the perk for wealthy overseas UK residents if they win the election. Multi-millionaire Mrs Murty was revealed to be a non-dom in 2022, meaning she paid a fee to avoid paying tax on dividends received from her family’s IT business empire.

Following an outcry, she agreed to pay UK tax on her earnings on her stake in her parents’ company Infosys, costing her poten tially millions of pounds. Yesterday, the Conservatives moved to neutralise the issue by scrapping the tax status altogether and vowing to use the extra money to cut taxes.

Mr Hunt said that from 2025, new arrivals to the UK would not pay any tax on foreign income and gains for their first four years of UK residency.

But after that, those who continued to live in the UK would pay the same tax as other UK residents. He said there would be ‘transitional arrangements’ for those benefiting from the status now.

Acknowledging that shadow chancellor Rachel Reeves had promised to end the ‘outdated tax perks’ in 2022, Mr Hunt argued that she had copied a Conservative former chancellor.

‘Nigel Lawson wanted to end the nondom regime in his great tax reforming budget of 1988, which is where I suspect the Labour party got the idea from,’ he said. ‘So the Government will abolish

‘New arrivals exempt for four years’

the current tax system for non-doms, get rid of the outdated concept of domicile and the remittance basis in the tax system, and replace it with a modern, simpler and fairer residency-based system.’

But Mr Hunt said that where Labour planned to use the extra money ‘ for spending increases’, the Conservatives would use it ‘ to help cut taxes on working families’.

Mr Sunak was recused from the policy discussions to avoid a ‘potential or perceived’ conflict of interest, with his deputy Oliver Dowden taking his place.

A Number 10 spokesman said: ‘There are established processes whereby arrangements can be put in place to mitigate against perceived conflicts of interest.’