He tackled head-on the criticisms being levelled at the industry by trade unions, MPs and others. He called for a simplified capital gains tax regime and review of arrangements for non-domicile in order to remove suggestions of unfairness in some quarters.
But he argued forcefully that investing in early stage businesses should continue to attract favourable tax treatment.
He claimed the real loss of tax revenue to the Exchequer is from interest payments by private equity-backed companies being paid offshore due to the development of sophisticated CLOs (Collateralised Loan Obligations). This reflects global market development of securitisation of loans, rather than being a unique feature of the private equity sector.
Chairman of the cross-party group, MP Philip Dunne said: "Jon Moulton put up a powerful case for private equity and venture capital investing in this country. This was a taster before his appearance before the Treasury Select Committee next week, where I am sure he will be a compelling witness. He is not shy about calling for the sector to be more open."
Mr Moulton said: "There is a lack of awareness by many of those who currently criticise private equity of how it works. Some changes could be made which would reduce perceptions of unfairness. But any Government needs to tread with care. Big buy-out funds are internationally mobile."
