Britain will soften some planned changes to its controversial non-domestic tax rules amid concerns about a millionaire exodus, the Treasury has confirmed.

Britain’s 200-year-old non-resident system allows people who live in the UK but live elsewhere for tax purposes to avoid paying foreign income and capital gains tax for up to 15 years. The regime has long been the source of controversy, leading British finance minister Rachel Reeves to October budget Confirmation that the Act will be repealed from April 2025 and all long-term residents will be subject to inheritance tax on their worldwide assets, including assets held in trusts.

Speaking at a fringe event at the World Economic Forum in Davos, Reeves said the government would soon table amendments to the country’s finance bill that would allow non-residents to bring money into the UK without paying significant taxes. The generosity of the rules.

Asked about the recent exodus of the ultra-rich, Reeves told the Wall Street Journal’s Emma Tucker: “We’re always listening to the concerns raised by the non-dom community.”

She added: “In the Finance Bill we will introduce an amendment to make the temporary repatriation facility more generous, allowing non-residents to bring money into the UK without paying significant tax.”

Reeves also sought to reassure wealthy overseas investors on Thursday that the changes would not affect double taxation agreements between Britain and other countries.

“Countries that have double taxation agreements with the UK, including India, are worried that they will be owed inheritance tax. But that is not the case. We will not change these double taxation agreements,” she said.

In a statement confirming the plans to CNBC, a Treasury spokesman said the changes were designed to incentivize non-residents “to move money into the UK, encouraging them to spend and invest that money here.”

The statement added: “While we do not expect these changes to impact the £33.8 billion in tax revenue the OBR expects to raise over five years, they reflect our ongoing engagement with stakeholders to ensure the reforms announced in the Budget are implemented as intended. “.

The government’s crackdown on non-residents in October was part of a wider package of measures aimed at those at the top, with new taxes on private equity bosses, private schools, second homes and private jets.

Critics warned at the time that the move would spark Mass exit of the super-rich — many of whom they say will be key contributors to the government’s pro-investment agenda.

An estimated 10,800 millionaires left the UK last year, a 157% increase on 2023, according to the latest figures from global analytics firm New World Wealth and investment immigration adviser Henley & Partners.