LONDON (Reuters) - Foreign investors may see UK tax policy as an obstacle but the tax regime is actually quite "benign", a group of advisors charged with promoting investment between Britain and the Gulf states said on Monday.
The government has faced criticism from business groups and even its own trade and investment minister Digby Jones over its tax policies -- which include a plan for a levy on wealthy foreigners.
Jones embarrassed the government in February by saying such taxes were making Britain less attractive to invest in.
However, a private sector committee set up by Jones’ department to promote financial services investment between Britain and the Gulf states said the problem was not taxation but communication.
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"People have a perception of what the British tax position is and we’ve had some mixed messages. Taxation is not the barrier, it’s the understanding which is the barrier," said Richard Thomas, Gatehouse Bank chairman and advisor on Kuwait.
The committee, which will liaise with Kuwait, Qatar, Bahrain, Saudi Arabia, Oman, Abu Dhabi and Dubai, has been set up to help British firms understand the needs of each Gulf market as well as to encourage flows towards Britain.
"The bottom line is that the UK is very benign for tax on investments," said Nick Edmondes, a partner at law firm Trowers and Hamlins and the committee’s advisor for Oman.
(Reporting by Matt Falloon; Editing by Ron Askew)
