Philipson says scrapping non-resident tax status would be a shame for Conservatives

Shadow cabinet minister Bridget Philipson said it would be a “naked disgrace” for the Conservatives if they implemented Labour’s policy of abolishing Non-Dominion status.

Abolition of the status, which provides generous tax breaks to some of the UK’s wealthiest residents, has long been one of Labour’s key policies, but it is understood that Chancellor Jeremy Hunt is considering doing so at this week’s meeting. Similar initiatives were announced in the budget.

Speaking to Sky News Sunday Morning’s Trevor Phillips, Phillipson said: “If they do [abolish non-dom status] This would be a great disgrace as Tory cabinet ministers have dismissed the idea for years.

“If they do that it just goes to show that in the battle of ideas in this country it is Labor who is leading the charge.”

Non-resident status allows foreigners who are resident in the UK but formally settled overseas to avoid paying UK tax on their overseas income or capital gains. Rishi Sunak’s wife Akshata Murty previously enjoyed undocumented status.

Mr Hunt is also understood to be considering different ways of extending the windfall profits tax on oil and gas companies, another key Labor policy.

Hunt said on Sunday he planned to slash the civil service and “cut red tape” to boost revenue. In an interview with Sky, he expressed disdain for equality and diversity initiatives in the civil service.

Speaking to Trevor Phillips on Sunday morning, Hunt said: “I think breaking the glass ceiling should be the job of every boss in every public sector organization, but I don’t believe in paying people huge sums of money specifically to do it These jobs are the right things to do.”

“More broadly, I think the civil service should get back to pre-COVID levels. There has been a massive expansion during the pandemic, and that’s absolutely right. But we need to get back to pre-pandemic levels.

“What we want are better public services. That doesn’t always mean spending more money. Sometimes it means spending less money, but we need to run them more efficiently.”

In a statement last autumn, the government announced plans to cap civil service numbers at 2019 levels during the next spending review, meaning 66,000 jobs would be cut.

Mr Hunt said Wednesday’s spring budget would be “prudent and responsible” for long-term growth. But he claimed that countries around the world with lower taxes “tend to grow faster”, citing countries in North America and Asia as examples.

Hunt ruled out borrowing to fund tax cuts, insisting there would be no “gimmicks” in the spring budget because it would “chart a path” in the direction of tax cuts.

“All conservatives agree that the state has a moral obligation to keep as much money as possible in people’s pockets because it belongs to the people who earn it,” Hunter said.

“But we all know that cutting taxes through, say, more borrowing is not conservative because then you’re just passing the bill on to future generations.

“So what you saw in the Autumn Statement was a turning point when we reduced national insurance rates by 2p.”

headmaster told the Sunday Telegraph The economic forecasts he received this week from the Office for Budget Responsibility “went against us” and left him with less fiscal space than he had hoped.