Skadden non-dom view costs Treasury $70k
The Treasury has agreed to pay Skadden Arps Slate Meagher & Flom $70,000 (£35,000) in fees for advice on its controversial tax changes for non-domiciles. The US firm was hired to provide an opinion - released with the Budget - on whether or not US non-doms should be able to claim the new £30,000 tax charge back against their US tax bills.
May 08, 2008 at 07:40 AM
2 minute read
The Treasury has agreed to pay Skadden Arps Slate Meagher & Flom $70,000 (£35,000) in fees for advice on its controversial tax changes for non-domiciles.
The US firm was hired to provide an opinion – released with the Budget – on whether or not US non-doms should be able to claim the new £30,000 tax charge back against their US tax bills.
Details of the deal were revealed in a Freedom of Information Act request put in by Legal Week sister title Accountancy Age.
The fee does not appear to have been finalised, with the Treasury saying only that "the contract between Skadden Arps and HM Treasury was valued at $70,000 at the time it was let".
Skadden was appointed – without any tender process – to do the work after fears were raised that the Government's charge would mean US non-doms could be taxed twice. US citizens can claim back taxes they pay abroad against their US tax bill, but the US Treasury had not confirmed whether or not the new non-dom charge would be treated as 'creditable'.
Skadden's opinion said that the charge would be "creditable" against US tax bills.
The Conservative Party this week criticised the payment, arguing it would have been better simply to get agreement from the US Government on the issue.
Tory MP and shadow financial secretary to the Treasury Mark Hoban told Accountancy Age: "It would be better if we had agreement from the IRS that the charge would be creditable…[We're] not much further forward despite having spent £35,000 of taxpayers' money."
Skadden declined to comment.
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