Having complained with ample justification of excessive fiddling during Gordon Brown's reign as chancellor, tax advisers confronted Alistair Darling's debut with little new to get steamed up about. Given the storm of protest that met Darling's wildly-reactive pre-Budget report last autumn, this was certainly not because there was nothing to moan about. But it was a long time since the contents of a Budget had been so comprehensively trailed ahead of the day itself, a move presumably intended to reinforce the steady-as-she-goes message in the face of continued turmoil in global financial markets.

On that yardstick, advisers are pretty unanimous that Darling delivered, having unveiled a series of measures of little import. The thing that tax and private client lawyers were most concerned about, taxation of non-domiciled individuals, gained the most attention and a fair amount of grudging acceptance (you couldn't call it approval). Darling effectively announced U-turns on everything except the actual charge of £30,000 for non-doms wishing to maintain their tax status after seven years in the UK, going a long way towards damping down anger to the level of mere simmering resentment and distrust.

The announcement that those earning less than £2,000 abroad are exempt from the charge and the unusual step of publishing an opinion from Skadden Arps Slate Meagher & Flom giving weight to the Treasury's attempts to prevent double-taxation with US authorities, are considerable results. Having been battered for weeks by a sometimes hyperbolic campaign claiming the reforms would undermine the City, few lawyers are still predicting that impending exodus from Chelsea and Mayfair. "Given where we thought we might be a couple of months ago we are all breathing a sigh of relief" says Withers' Chris Groves.

And whatever miscalculations the Government made, some of the criticisms were hard to sustain, especially the parallels drawn with New York's loss of status after Sarbanes-Oxley (Sox). Sox was sweeping reform that increased the cost of capital and ushered in tough disclosure requirements for foreign companies shopping globally. It also added pressure on existing stress points, notably huge litigation risks and, to a lesser extent, excessive red tape and the US' damaged reputation after the Iraq invasion.

In contrast, the non-dom policy is about taxing individuals and many of those contributing to the City cannot easily go elsewhere because, by definition, they work in world-class financial centres, not relative backwaters. And the history of markets shows that once liquidity amasses in one location, it is hard to move (though the US managed it in the 1960s when they taxed the Eurobond market to Europe). This saga has done some damage but, having pledged to avoid further taxes of non-doms for the current and next Parliament, it should prove no more than a minor scrape.

Elsewhere, a tax reform that had far more chance of undermining the City N changes to capital gains tax N was actually discreetly welcomed by some lawyers. Despite raising the lowest rate payable from 10% to 18%, the feeling is that this still leaves the UK as an attractive jurisdiction and will do nothing to undermine London's strength in private equity. Indeed, the 18% rate will be easier to access for some businesses that didn't want to go through the hassle of securing full taper relief. Meanwhile, the Treasury underlined its pro-City credentials with well-received announcements designed to bolster London's status as an Islamic finance centre. Overall, it is back to pro-City business as usual and the fiddling will doubtless be back in force next year.

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