New legislation designed to increase the tax burden on non-doms has had some unexpected effects. Ed Powles investigates
Making law is never easy. Making tax law is especially hard. It inevitably involves a precarious balancing act. Above all, the goal is usually to raise revenue or to change taxpayers’ behaviour. But, no matter how simple the policy on which tax is based, the law rapidly becomes very complicated. There is a perpetual cat and mouse game between the legislator and the taxpayer. The legislator makes up simple rules; the taxpayer finds ways of getting around them. The legislator attempts to plug the loopholes by making more complex rules; the taxpayer finds more imaginative ways of circumventing them. The result is an increasingly overweight tax code. 
