When in 2008 Alistair Darling introduced a £30,000 annual fee for those claiming non-domicile tax status it was an admission that a system two centuries old had failed.

When George Osborne announced in his autumn statement that the fee would rise to £90,000, he signalled his agreement. Both chancellors knew the truth: the old "non-dom" rule - never a law - had been abused flagrantly. Despite their efforts, it remains a cause for concern.

As things stand, an individual can be born in the United Kingdom, grow up here, reside here and work here permanently yet owe only the annual fee to the taxman. Simply prove that a father or grandfather was born abroad - bizarrely, mothers and grandmothers do not count - and you can claim another country as your "true home". You need not live or be "tax resident" there.

For the very rich, it is a perk worth every last penny of £90,000. All offshore accounts and investments can be left undeclared. Only UK earnings are taxed. If your accountants know their business, inheritance tax can be avoided thanks to offshore trust arrangements. For around 116,000 individuals (at the last count) even a fee unimaginable to ordinary people is a bargain.

Yesterday, Ed Miliband's announcement that a Labour government would close the loophole seemed destined to become bogged down in election squabbling. The revelation that Ed Balls, the shadow Chancellor, had seemed to cast doubt on the reform in a January interview with the BBC was, no doubt, a gift to the Conservatives. Why abolish something if, as Mr Balls said, "it ends up costing Britain money"?

One simple answer would be that it is the right thing to do. Labour's announcement might have lacked something in presentation, but the principles are sound enough. Mr Miliband means to campaign for "the many not the few": what better way than this? The UK's "tax gap" in missing revenue, as he said yesterday, is at least £34 billion annually at a time when the country is struggling with debt and deficit. Above all, there is no obvious reason why those who are already fortunate should be given preferential treatment.

Conservative claims that the Labour scheme is "shambolic" depend on selective editing. In his interview, Mr Balls in fact went on to say that he would be tougher on non-doms than Mr Osborne. The usual claim that the rich will flee at the thought of paying fair taxes is meanwhile becoming threadbare, not to say insulting. The evidence for the assertion is slight and it does not, in any case, justify unfairness.

If anything, Tory critics of Mr Miliband should be careful about the cause they seem to favour. Tax avoidance by a tiny minority, whether entirely legal or not, is deeply offensive to the majority. A party preaching the need for still more austerity should not, if wise, appear to defend the privileges of those who need help the least. Non-dom status is a relic whose time has long gone.