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Ultra-rich attract interest in UK election campaign

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AFP London
Last Updated : Dec 11 2019 | 5:10 PM IST

Britain's general election campaign, which ends on Wednesday night, has turned the spotlight on the closed world of the ultra-rich.

The main opposition Labour party has repeatedly attacked tax avoidance and evasion, and promised to renationalise key industries, including mail delivery, energy and the railways.

Billionaire mobile phone magnate John Caudwell on Monday warned Labour tax hikes for the top five percent of earners and business tax would stifle investment.

But the ruling Conservatives, who are promising across-the-board tax cuts, have been more accommodating, proposing few changes that would alter Britain's status as an attractive destination for the elite.

The Sunday Times in May said there were 151 billionaires in Britain. The 1,000 richest families and individuals have a record combined wealth of ?771.3 billion ($1.01 trillion, 916 billion euros).

Those with the biggest fortunes come from across the world, including Russia and Asia.

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The Indian-origin Gopichand and Srichand Hinduja brothers head the list with ?22 billion, with the Russian businessman Alisher Usmanov eighth, just in front of his compatriot Roman Ambramovich.

Britain owes its special status to its tax regime, especially the "non-dom" status that allows some British residents to maintain fiscal residency overseas and not pay income tax on earnings from outside the country.

"The UK provides an attractive tax regime for foreigners who have large amounts of income from investments, because this is the easiest type of income to shelter from UK taxation using the 'non-dom' regime," said Andrew Summers, from the London School of Economics.

According to the revenue and customs service, 78,300 people were classified as "non-dom" in 2017-2018, allowing them to pay ?2 billion less to the Treasury.

Another advantage of the British tax system is that capital gains tax can be offset by much lower taxes on property, even on the most expensive.

Unlike France, there is no fortune tax.

Efun Chin, founder and principal of Mayfair Legal, said: "The UK has been an attractive destination to many foreigners for many years, decades and many reasons as well.

"It's due probably to historical reasons where Britain used to have an empire and many Commonwealth nationals would see the UK as the destination to study because of the quality of the institutions."

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First Published: Dec 11 2019 | 5:10 PM IST

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