Labour’s candidate for Wolverhampton North East and Shadow Housing Minister, Emma Reynolds, has supported the Labour party plan to scrap non-dom tax status. The plan was announced by Ed Milliband on Wednesday. Non-domiciled residents are individuals who live in the UK but are able to claim a strong link to a foreign country. This link can be a foreign born parent or spouse, but in some instances has been only ownership of a property abroad or a foreign newspaper subscription. They are able to avoid tax on all their earnings outside the UK, so long as that income remains outside the UK.

Emma said “The non-dom tax rules are out of date and have no place in a modern fair tax system. People who live in Britain should pay their taxes in Britain. People born here, brought up here and living here can claim non-dom status and use these rules to avoid paying tax. The non-dom rules are unfair.”

“The vast majority of working people have to pay tax on all of their income and gains, wherever it comes from. It is wrong that a group of very rich individuals, who are able to afford expensive tax lawyers, are able to avoid tax on a massive proportion of their income through these rules. Wealthy non-doms can live in the UK for many years, but avoid paying UK tax on income made abroad.”

“The non-dom rules are also used to avoid tax on UK property. Non-doms can use offshore trusts to buy expensive UK homes and avoid inheritance tax.”

“Labour will abolish the non-dom rules and replace them with a system where everyone who makes the UK their home pays their fair share of UK tax, raising hundreds of millions of pounds in additional tax revenue. This will be used to reduce the deficit as part of Labour’s plan to balance the books in a fair way.”