If Spain can get support from across the EU. And Brazil the same from BRICS then we could see change.
Best not to hold your breath though...
replies(2):
Best not to hold your breath though...
There is a consensus that non-dom status (basically rich foreigners, very broadly defined, pay hardly any tax) in the UK needs to go. The main point made by people opposing this is that they can easily move to a number European (mostly EU) countries that have similar schemes and still only be a short flight away from the UK.
Or maybe I do understand - it has nothing to do with trying to fix the problem but is just a populist agenda that sounds good and helps with winning elections.
If you regard progressive taxation as "populist", fine. I regard it as simple being fair.
To put it another way, why should there be a special exemption so super-rich foreigners do not have to pay tax?
> To put it another way, why should there be a special exemption so super-rich foreigners do not have to pay tax?
I do not know what you are referring to here. The non-dom issue is primarily about taxing income.
Terrible principle. You should pay proportionally to what you use/spend in the country. These days it's very difficult to say who lives where, especially in case of rich people. If someone spends 200 days in one country and 160 in another it's unfair to the latter country that 100% of the tax is paid in the first one. If someone spend their time across 3 countries current solutions don't make any sense at all. That's why it makes sense to tax assets locally.
The concept of "tax residency" belonging to one country is just a terrible idea. It's the reason a lot of those abusive schemes exists. The way is to get rid of that principle and substitute it with something that is not easy to get around like taxing assets under your control.
>>To put it another way, why should there be a special exemption so super-rich foreigners do not have to pay tax?
There shouldn't be. They should pay on assets they use in your country. If they have income there you can tax income issuer (like payroll tax). There is no need to tax income from abroad - let other countries who actually control assets that produce that income tax them.
A shift from taxing income to taxing assets instead might work. A wealth tax instead but its not easy. Land can be valued, so can publicly traded investments. What about ownership of privately held businesses or works of art? Where are yachts and aircraft taxed?
This also avoids a loophole that buying land and doing nothing on it means you pay very little taxes while patiently waiting for its value to increase because of other people who do productive things nearby
>>or do you think that anyone who invests abroad should be exempt on tax on income from those assets
Of course, those should be taxed where they are located. Much easier to tax companies where they operate than elusive "income" of increasing stock value.
>>What about ownership of privately held businesse
You don't need to tax wealth related to business. Your can make operating businesses more expensive by introducing taxes and fees on it and then not tax any income it still generates.
EU politicians intuitively know that's the way when talking about digital tax. Just tax "IP protection" as % of revenue in your country for example. Then you will get a share of Apple or Google no matter where it's registered as long as it has revenue in your country.
It's way easier to make Google generate 20% less profit than to tax 20% on its profits. It's also very easy to tax it where it's operates and not care about creative accounting tricks it uses to show less profit.
The current system means people living on Cyprus pay less tax on Google value than Americans. It's just a completely stupid system that breeds abuse.