Nicky Morgan, Conservative education minister, was the sole Tory spokesperson on the Today programme this morning, so she was the unlucky enough to have to respond to Labour’s “non-doms should pay tax” policy announcement. (An actual policy being announced during a general election campaign, I hear you say? Try not to be too surprised, they slip out sometimes.)
Jim Naughtie naughtily tacked it onto an otherwise unremarkable interview about primary education. That’s when it all got confusing.
The key part is here, at about 2hrs40mins.
Morgan says:
Labour had 13 years in which to tackle this and they’ve haven’t done this. I don’t think anyone would disagree that people should be paying taxes here, because those taxes are essential for what we’ve just been discussing, education.
She makes it sound as if all reasonable people would, of course, agree that people living in this country should pay tax on their earnings. Except that hasn’t been her government’s policy up until now, and she’s currently supposed to be rebutting exactly this proposal from the opposition party. Naughtie pounces:
Well hang on, you’re saying that no one would disagree that people living here with non-dom status should be paying taxes on their overseas earnings?
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She responds:
Yes, well that’s exactly what we’ve said, both individuals and corporates, and that’s why we’ve increased the non-dom levy…
They go back and forth a few more times on the levy, and then Naughtie gently reminds her that this “isn’t your government’s policy”. At which point she staggers backwards and attempts to walk to party line for the rest of the interview.
This mole is confused. What should reasonable people be agreeing with about non-doms paying tax, Minister Morgan?
Here’s a transcript of the whole exchange:
NM My reaction is that once you look at the detail, actually they’re not proposing to abolish non-dom status. They’re talking about potentially changing the length of time someone will be able to be here…
JN …they’re tightening the rules, no argument about that, they’re tightening the rules. Is that a good thing or a bad thing?
NM Well, we have already tightened the rules in this parliament. And we are very clear, the Conservative Party and George Osborne in the Treasury has been very clear that people who are based here should pay taxes here, we’ve introduced from last week a tax on companies…
JN …Well hang on, a lot of them don’t…
NM But we have absolutely cracked down. We’ve increased the non-dom levy in this parliament, non-doms are paying more than they’ve ever paid before. Labour had 13 years in which to tackle this and they’ve haven’t done this. I don’t think anyone would disagree that people should be paying taxes here, because those taxes are essential for what we’ve just been discussing, education.
JN Well hang on, you’re saying that no one would disagree that people living here with non-dom status should be paying taxes on their overseas earnings?
NM Yes, well that’s exactly what we’ve said, both individuals and corporates, and that’s why we’ve increased the non-dom levy…
JN Well why aren’t they?
NM We have increased the non-dom levy…
JN No, the levy is one thing, and the level at which it is set is one thing, paying the tax is another. Are you saying they should pay the tax? Because that’s not your government’s policy.
NM I’m saying that we have at the Treasury clawed back £5bn in this parliament, a crack down on aggressive tax avoidance and evasion and I think that’s exactly what we should do. They’re now paying more in stamp duty…
JN That’s a different issue…
NM I think it’s overall the same issue, that people who are based here should pay their taxes here, and that’s exactly why the diverted profit tax which we saw come into force last week is exactly what we have done in this parliament, because those taxes are essential to pay for those essential services, like education, health and other critical public services which people expect to be fully funded.
JN Are you saying that you, personally, from what you’ve just said, would like to see people with non-dom status paying tax in this country on their overseas earnings?
NM Well, I think we can have the debate about it. I think what the Labour Party are…
JN No, I’m just asking you. Would you like that to happen?
NM What the Labour Party are not being clear about today is on whether they are intending to abolish non-dom status, or simply change or consult on the length of time people would be here to before they have to pay their taxes…
JN Well, that’s fine. John talked to Ed Balls about that earlier. But I’m asking you: would you like to see non-doms paying tax on their overseas earnings or not?
NM Well, we certainly…As I say, that’s why we’ve increased the non-dom levy in this parliament. Non-doms are now paying more in this parliament thanks to the Conseravtive-led government policies over the course of the past five years, I think that’s the right thing to happen.
JN Nicky Morgan, thank you very much.
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