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Proposed new rules concerning non-domiciled residents 'could kill the golden goose', Lord Balfour has warned.
In a letter to the Financial Times, the finance veteran said that drafting the mooted changes 'is proving hard'.
He added that the 'tax-producers' who will be 'hardest hit' by the proposed flat rate taxes or by the submission of their non-UK assets to British taxation will not be the so-called super-rich.
The most affected, he claimed, will be the 'important core of people… already contributing very substantially to the Treasury via pay-as-you-earn and National Insurance.
Lord Balfour went on to question whether 'a policy of imposing a greater tax burden on foreign employees in the UK than on wealthy tax migrants [is] really what either Labour or the Conservatives want'.
He suggested that for wealthy migrants in the UK to contribute more by way of tax, the Government could introduce a class of person to be known as 'UK tax-resident but not domiciled'.
This, he said, might work by making liable to income tax all remittances of funds to the UK by and for non-domiciles. However, 'a flow-through would be allowed from trusts and companies of treaty or other credits for income or gains taxes already paid on those funds at source'.
