In recent years the court of public opinion has often been quick to condemn the non-doms as tax dodgers who refuse to pay their way in the UK. While it is true that non-doms have the benefit of a tax regime more favourable than that available to ordinary Brits, to take that view is to overlook the vast amounts of UK tax actually paid by non-doms and the financial and other benefits which they contribute to UK plc. The skills and wealth that the huge number of bright and successful people attracted to the UK by the non-dom regime bring with them are vital in helping us compete on an increasingly international stage.

The draft legislation for this year's budget, unveiled in December, and the consultation which preceded it, included welcome recognition by the government of the contribution which non-doms make to the economy through the tax they pay, the businesses and jobs they create and the money they spend here. While the legislation includes some helpful simplification of the current, Byzantine, rules, this is merely tinkering at the edges. The flagship reform set out in the bill is designed to encourage non-doms to invest their overseas money in UK businesses.

There are many reasons why a non-dom might choose to invest offshore but the real killer to UK investment is the fact that if they invest offshore money which includes income, they face a 50% tax charge on that income when they bring it to the UK. The new proposals would scrap that tax charge provided the money is used to invest in UK businesses, and when funds are realised, they are either reinvested or taken out of the UK again.

The government is keen to boost business investment, but will these proposals be enough to make a real difference? I would argue, no. The following three reasons highlight why the reform is unlikely to live up to expectations.

First, while in many ways the legislation is broad ranging, it is so complex with such detailed (and strict) rules about what businesses qualify and how the investment may be made that any prospective investor, no matter how hands on their approach to their finances, will need professional advice to ensure that they do not trigger an unintended tax liability.

Secondly, the legislation is hedged about with complicated anti-avoidance provisions. Even if a non-dom acts in good faith and does everything right, they may become subject to a tax liability through circumstances which are completely beyond their control. For example, a trading company which ceased to trade would cease to be eligible for tax free investment. This means non-doms will need to monitor their chosen companies constantly to spot if they are no longer compliant, so that they can try and head off the potential tax liability. The relief applies where people connected to the non-dom, such as a spouse or company, make the investment. This also means that the spouse, for example, can trigger a tax liability on behalf of their partner and the individual himself will still be forced to foot the bill - a rather horrifying possibility for anyone suddenly faced with the prospect of divorce!

Thirdly, some of the provisions are impractical. Where the tax relief is withdrawn, the individual has a limited time to take steps to prevent a tax charge crystallising. A non-dom who has a minority interest in an unquoted company is simply not going to be able to take those steps - which might involve realising the entire investment - within the time limit of 45 days.

In the light of these issues, one has to ask why non-doms would invest in the UK when they could invest in other parts of the world without all the additional costs and risk. Given the many other tax disincentives that non-doms face in making UK investments, this measure does not go far enough to achieve the government's stated policy objective of encouraging "active investment in a broad range of businesses and sectors".

As it stands, the relief is likely to be taken up only by those who wish to invest in their own business where they will have complete control over the potential liabilities. If the government is serious about creating a real incentive to invest in the UK, it needs to find a simpler and more practical solution.

Otherwise, we face a bleaker prospect than many people realise. The majority of non-doms are not super wealthy globetrotters, but talented and high-flying individuals working within UK companies, or entrepreneurs building businesses and creating jobs in the UK. They send their children to UK schools and universities, they spend their money in the UK. We can ill-afford to lose these people at the best of times, let alone in the current climate of economic upheaval and financial strain.