It will cover a generous pay rise for the nurses. It will bail out the NHS. It will put the public finances back on track, and, even better, it will make the country more equal. The Labour party has a simple solution to most of the problems the UK faces. It will abolish ‘non-dom’ status, and collect lots of extra tax revenues from rich foreigners. Hey, presto, problem solved. The trouble is, there is a slight flaw in the plan. They are already fleeing, and we will miss them when they are gone.

It is a complete fantasy to think we will raise any extra tax revenue from abolishing non-dom status

Nom-dom status has always been controversial. It allows anyone who isn’t British, such as the Prime Minister’s wife for example, to pay tax only on the money they bring into the country, and not on the assets they hold overseas. So someone who is worth several billion might end up only paying a few hundred thousand pounds in tax every year. Clearly, if you taxed them at 45 per cent you would raise a lot of extra money. Indeed, only last week the Labour leader Sir Keir Starmer pledged to get rid of non-dom status to spend the money on the NHS.

It is a popular policy. Everyone likes the idea of taxing rich foreigners more to pay for higher spending. And yet, what happens if they are not quite so keen on the whole plan?

Figures released this week show the numbers of non-doms has already started to collapse. New claimants fell from 14,200 to just 8,500 in the 2020-21 tax year and from 15,400 in 2018-2019. It is not hard to work out why. We are already charging them extra levies to live in the UK, and now they face the imminent threat of a huge rise in their tax liabilities. It is likely that in the latest tax year, with Labour almost certain to win the next election, the numbers have dwindled to a trickle, and many more have started packing their Gucci bags and leaving.

In reality, it is a complete fantasy to think we will raise any extra tax revenue from abolishing non-dom status. By definition, all those people are very rich, globally mobile, and don’t have any very strong ties to the UK. There are lots of other places they can live if they want to. By abolishing it, we won’t raise any additional money. Even worse, given that many of them are entrepreneurs establishing new businesses, and many more are investors in the UK, we will lose the wealth and jobs they create.

We can tax them at eye-watering levels if we want to. But there is no point in pretending that non-doms will stick around. They are already leaving the country in droves, and many more will depart before Labour finds itself in government – and we will miss them when they are gone.