Dragon’s Den star Duncan Bannatyne has said he will vote Labour because of Ed Miliband’s “courage” in pledging to scrap non-domiciled tax status.

The businessman only last week signed a letter from 103 businesspeople in support of Conservative economic policy.

“Ed Milliband says he will abolish non-dom status in UK. This gets my vote I never thought any party would have courage to do this,” he tweeted on Tuesday evening.

Non-domiciled tax status has existed since the colonial era and allows UK residents with earnings from abroad not to pay tax on them in Britain.

Mr Miliband will today argue that it is not fair for 116,000 non-doms to face different tax demands to others.

“We don’t compete in the world by offering tax advantages to a few that we don’t give to all our citizens and businesses,” Mr Miliband will say.

Ed Miliband at an election campaign event in Bristol on Tuesday. He will say the non-dom rules ‘hold Britain back’ (Reuters)

“It is not fair on all those millions of working people and businesses who pay their share and play by the rules. And it’s not fair on all the people who rely on our public services either.”

The announcement that he will vote Labour appears to be somewhat of a change in heart for Mr Bannatyne.

A letter on the front page of the Daily Telegraph last week, signed by 103 business executives included Mr Bannatyne, praised Conservative economic policy which it says has “been good for business and has pursued policies which have supported investment and job creation”.

“We believe a change in course will threaten jobs and deter investment. This would send a negative message about Britain and put the recovery at risk," the letter said.

Chancellor George Osborne argued that intervention was “unprecedented in any recent general election”, although an analysis by the Independent found that one-in-five of those who had signed it had been given honours by David Cameron, while one third were Conservative donors.

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BBC Newsnight reported last night that the policy was drawn up by Labour at the same time as its energy price freeze proposal but was held back for the general election campaign.

One top tax lawyer, Jolyon Maugham QC, estimated that the revenue raised by the move would be “a yield well north of £1bn” – and that it could save the Treasury as much as £3bn.