UK
Has Darling damned the City?
16 October 2007
Thank you, Darling, you’ve only gone and messed up London’s long-term chances of squeezing New York out of the global financial centre hotspot.
The latest sweeping changes to our tax system have scuppered the City’s chances of biting further into the Big Apple’s dominance, according to one economist writing in The Times.
London’s growing pre-eminence has been giving New York the jitters for some time. But the sad demise of the tax regime that favoured both foreign workers and small businesses spells bad news for the City’s financial prowess, reckons The Hudson Institute’s Irwin Stelzer.
Stelzer says the fixed annual fee of £30k for non-doms and the elevation of Capital Gains Tax from 10% to 18% has made London less attractive to investors and presented the Big Apple in a juicier light.
To add insult to injury, Stelzer says New York is a more attractive place to live. Forget over-priced condos, the $2 pound and the proximity of Donald Trump, he says New York is a) cheap, b) safe, and c) more vibrant. By comparison, London is said to be expensive and dangerous.
Is Stelzer (who lives in London but is evidently an NYC exile) right? Has Darling given the City a kiss of death, or was his budget merely the start of a nice friendly hug?
Although I don't have a problem with a bit higher taxes on the VC, foreign workers per se, I would have felt better if those tax increases were to go towards decreasing other taxes, rather than increasing the welfare spend, cos government taking more and more from the economy and not putting anything back is gotta end in tears.
Neil 21 Oct 2007
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