The Chancellor Rachel Reeves announced on Friday to soften plans to abolish non-dom status.
It’s encouraging to see the green shoots of a softening on what would have been a self-harming policy.
But ultimately, it’s nothing more than a drop in the ocean compared to the tsunami of challenges facing the founders of high-growth businesses.
The sharp rise in minimum wage rates and employer National Insurance contributions are wreaking far greater havoc on this country’s most dynamic companies, driving up costs across the board. Some businesses may be able to absorb them by raising prices, but this will only drive inflation and hinder efforts to return the UK to economic prosperity.
The situation is dire in the sectors where pricing cannot simply be adjusted – for example, care homes – and many are being forced to shed up to 30% of their workforce.
If there’s one positive to take from this, it’s the glimmer of hope that other flawed policies might also be reconsidered before it’s too late. The UK desperately needs to remain an attractive place for high-income residents and ambitious entrepreneurs—without them, our ability to compete on the global stage is at serious risk.
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