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Non-doms getting ready to sell up say estate agents
Hugo Duncan and Jason Beattie04.03.08
Estate agents have warned a flood of wealthy non-doms are preparing to sell up because of the Government's proposals to tax them.
London agents told the Standard they have been approached by a large number of affluent foreigners who are either putting their homes on the market or testing the waters.
Alistair Darling plans to levy wealthy foreign residents who have been in Britain for at least seven years.
Under the long-standing non-dom loophole they pay
no UK tax on their earnings outside Britain, a benefit that has made London the world's biggest billionaire tax haven. But estate agents say the levy will reverse the trend of recent years that has seen wealthy foreigners buying up the few central London homes that come on the market.
Peter Wetherell, of Mayfair agents Wetherell, said: "People are turning off the lights and shipping out of the country."
James Bailey of Douglas & Gordon in Kensington also warned of an exodus: "There is a huge amount of uncertainty and nervousness over the non-dom issue. We have had several people very worried about the situation and are seriously thinking about packing up and going.
"What happens when you have more property coming on to the market is prices start to come down. It also means that we are going to have a more restricted market place because there will be less buyers out there looking to purchase. It is very worrying."
Robert Bartlett, chief executive of Chesterton, said the proposals have also put foreigners off moving to London. "A number of prospective buyers from outside the UK have already put an investment in the London property market on hold until the question is resolved and some owners are considering selling before the tax is introduced," he said.
"The Chancellor would be extremely unwise to introduce this tax," Mr Bartlett added.
Wealthy clients of Jonathan Hewlett, of Savills in Sloane Street, are also getting ready to leave if the Chancellor presses ahead with the tax in April as planned.
"Our clients have got their tax lawyers and accountants working on what is best for their affairs. I haven't got a mass exodus but there is massive concern."
Mr Darling hopes to raise an extra £650 million a year from the non-dom tax but the Treasury has faced fierce criticism for its plans ahead of next week's Budget, including from its own Trade and Industry Minister Lord Digby-Jones.
Reader views (2)
Remember James Callahan he came up with a wonderful idea tax all the rich people 98 pence in the pound (that's a great idea) except the people who could afford to pay also could afford to say goodbye and they did in droves it took 10 years to recover from that gaff.
- Eddie Orordan, Wisbech
If these billionaires don't pay tax then what benefit are they to Londoners at large? In fact they just push up property prices. I guess top end estate agents may suffer.... IMO we should let them go!
With regard to City workers, shifting banks' entire European operations from London to, say, Frankfurt where there is currently far less investment banking "infrastructure" would be a slow and expensive process for the banks and despite their bellyaching and whingeing, City workers won't be leaving in a hurry.
Why shouldn't they cough up like the rest of us?
- Mcw, London
