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The proposed Statutory Residence Test does little to improve the state of the law relating to the residence of an individual for tax purposes. Discuss.

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Introduction As part of the Finance Bill 2013, the Government is seeking to introduce a statutory definition of residency for tax purposes. The objective of defining residency for tax purposes, through a statutory residence test, is to provide a system of assessing residency that “ is transparent, objective, and simple to use ”. [1] Furthermore, the proposed statutory residence test has been designed “ to ensure that those with close connections to the UK pay their fair share of tax and that the rules do not give rise to unfair outcomes or opportunities for tax avoidance. ” [2] Whether the introduction of a statutory residence test improves the state of the law relating to residence of individuals for tax purposes is subjective and open to critique. However, this essay will seek to outline the criticisms and flaws of the current regime and assess whether the introduction of the proposed statutory residence test satisfactorily addresses those criticisms and flaws.