Labour are much better at wrecking things than fixing them

The non-dom U-turn may be the most pointlessly self-defeating errors of this government

17 June 2025 7:57pm BST

Daily Telegraph 

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Against some stiff competition, the decision to target non-doms for an inheritance tax raid on their global assets could go down as one of the most pointlessly self-defeating errors of this Labour Government.

Scrapping non-doms status in favour of a residence-based regime brought all assets into the scope of inheritance tax after a four-year grace period, with HMRC’s claim lasting for up to 10 years after someone leaves Britain.

Perhaps unsurprisingly, these reforms have triggered a wave of high-profile departures, with Bloomberg noting a surge in company directors moving abroad concurrent with the changes and advisors claiming a record exodus of millionaires.

Having killed the goose that laid the golden egg, Chancellor Rachel Reeves now appears to be developing an interest in resuscitation, with speculation that the Government may now U-turn on the inheritance changes as fears mount that they are set to cost the Treasury money.

It is a great deal easier to break something, however, than to fix it. Merely reversing changes may not be enough to lure back those who have disrupted their lives by leaving, particularly if they fear future tax raids.

If the damage Reeves inflicted is to be undone, it will require a concerted effort to give Britain a more competitive tax regime that welcomes the wealthy and the economic benefits they bring.

The overwhelming hostility of Labour towards private wealth – from levying VAT on private school fees to the rhetoric deployed by ministers – indicates that this is wishful thinking. So too, then, may be Reeves’s hopes to fix what she has broken.