Sunday, 7 March 2010

Non-dom tax status is the ultimate cyberpunk accessory

Another great article in the Guardian, this time a background piece on non-dom tax status by Stephen Armstrong.
Ultras, according to Frederico do Valle, are the world's new refugees. By Ultras, do Valle, lead consultant in wealth management at CapGemini Financial Services, means Ultra High Net Worth Individuals – otherwise known as multimillionaires. They are a growing group, these super-rich nomads, and they're on the move like mammoths in an ice age. Driving them on is their desire to avoid paying as much tax as they possibly can, while remaining within the law. Do Valle calls this "wealth preservation", and he says it is getting harder every day.

"Ultras are now basically globetrotting," he explains. "They don't want to commit, because there's a lot of uncertainty out there about tax rules and regulations. It depends how long you reside in each place before you pay tax and the laws are changing, shifting. We have one client who lives on his boat and just moves around because he doesn't want to be stuck with one tax jurisdiction permanently."

I was thinking that this way of liffe would not be possible without the amazing communications links that all that money can buy. The unamed wandering mariner likely has a hugh mega-million pound thing the size of a small car ferry with high bandwidth sattelite communications sufficient for him to play World of Warcraft from middle of the Antarctic Ocean if he cared to, let alone shoot off a few emails instructing his proxies to shut down a car plant in Sheffield or assassinate a journalist in Latvia.

The increasing speed of information exchange has led to wealth pooling around individuals. In the history of wealth and power, a rulers reach has only extended as far as they could extend their communications. Instant communications allow plutocrats direct control over more and more of their empires, and the reulting efficiencies in control have given them a tighter than ever control of their finances.

One wonders what the future holds (being a sci fi writer an all). As communications efficiency increases, there'll be more of this. Will it ever cross over to the middle classes? Can't you imagine a newly nomadic commuter class depending on complicated international flat share arrangements and tele working saving  them a few grand a year tax. My own tax bill is in the region of £20,000 a year - I could almost do with some of that back.

The only thing saving us from an anarchistic technocratic dystopia are the heroic actions of the revenue so secure what's owed! That sounds facetious, but if you think of it, they the people who go around collecting all the money that runs our schools, keeps the NHS working and the roads open, the police walking our streets and the army protecting us from foreign threats (such as they are... a topic another day).

So, let's close this with a hopeful cheer for the tax man! I hope you screw the rich bastards!

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