Travers Smith's Alternative Insights: The dangers of over-zealous enforcement

The UK's new prime minister, Andy Burnham, and his incoming finance minister, John Healey, face an unenviable balancing act.  To meet public spending commitments, and stick to their pledge to maintain fiscal responsibility, they will need to look at ways to raise more revenue.  Higher earners are likely to be in their sights. 

But, since they also want the UK to remain a global hub for financial services, they know they will need to proceed with caution. Repeal of the generous "non-dom" rules and the more recent overhaul of the carried interest tax regime have undoubtedly reduced the UK's appeal to private capital firms.  Rumours that the new administration will consider increases in capital gains tax rates and a new wealth tax were not confirmed in this week's early policy announcements – but those measures will surely be looked at in the coming months.