A MAJOR overhaul of the tax regime for non-doms in the UK would damage its own economy and that of Guernsey’s in the long-term, according to tax expert Graham Parrott.

The Ernst & Young partner (pictured) said a fresh crackdown on non-doms was something the island would need to a keep a close eye on, but the overall impact on Guernsey would very much depend on which approach was taken by the coalition government.

According to reports in the UK, Chancellor George Osborne is said to be considering a non-dom levy of £25,000 a year on those who live in the country but do not pay full taxes.

And unlike the non-dom tax of £30,000 a year introduced by former Prime Minister Gordon Brown, it could come into force for those it affects before they have lived in the UK for seven years or more.

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