Capital Gaines - Spear's Magazine

Capital Gaines

Would the British government and courts system be quite this punitive if we weren’t in such a financial mess?

Would the British government and courts system be quite this punitive if we weren’t in such a financial mess? This question is prompted by the now notorious case of Robert Gaines-Cooper, the entrepreneur who battled HMRC over his non-dom status, saying that because he spent fewer than 91 days a year in the UK (the statutory maximum), he could be a non-dom.

The court disagreed and said that because ‘the centre of gravity of his life and interests’ — his family, an Oxfordshire mansion, his art and gun collections — remained in England he had not made a clean break. This is despite his Seychelles plantation house, where he has lived almost constantly for 30 years, his irregular returns to Britain and his desire to have his ashes scattered in the Caribbean.

The issue of non-doms has been hot politically, too. Lord Ashcroft — or ‘the sleaze from Belize’, as he has been called — was hauled over the hottest of coals for his dissembling over whether he was or was not a non-dom, even as he subsidised the Tories over the past decade. (It was never a difficult question for anyone with the least sense.)

Lord Paul, on the other side of the House, will now renounce his non-dom status; last year he became a member of the Privy Council. Zac Goldsmith was forced to cease being a non-dom in order to retain his candidacy for Richmond, thanks to public opprobrium. And a bill is going through Parliament which will ban non-doms from sitting.

Everyone is after the non-doms, and the government will have its — or rather their — millions. Even if the government can take similar amounts off Britain’s other non-doms, the money gained will be a minuscule fraction of our national debt (£178 billion, if we’re lucky), and the net result will be an entire class of highly productive and valuable members of society who have been aggravated beyond measure.

There is enough money at stake, on an individual basis, to persuade non-doms to quit Britain and not even leave a single stick of furniture here. Will that be a positive result?

Spear’s has no time for tax evaders, but tax avoidance, as permitted by national and international laws, is the sort of activity that anyone with money, good advisers and the smallest amount of wit will undertake. There is nothing wrong with wanting to preserve hard-won wealth for your family, and it is a perverse government that tries to make it so. ‘Moral’ objections are too often jealousy or hypocrisy cloaked in piety: rare is the person who does not try to arrange their affairs, from the greatest to the smallest, in the most profitable manner.

What the government must realise is that — as the Canadian lawyer and friend of Spear’s David Lesperance has put it — we are causing the flight of the geese that lay the golden eggs. There is indeed a somewhat substantial sum that could be obtained in the short term by holding up non-doms by their ankles and shaking them until their wallets obey the laws of gravity. But in the long term, when we most need entrepreneurs, people who will innovate and make British industries profitable and world-beating, we will have driven them away.



 

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