Some 60 per cent of millionaires living in Britain believe that life would be better abroad, according to new research.
A survey of 1,000 of the nation’s wealthiest also found that 53 per cent would be more likely to leave the UK if Rachel Reeves, the chancellor, pressed ahead with a wealth tax. The migration consultancy Arton Capital, which commissioned the study, said it showed that Britain was at a “tipping point”.
Armand Arton, the chief executive, said: “The uncertainty around the government’s proposed wealth tax mirrors the ongoing economic uncertainty seen around the world. The longer unpredictability persists, the greater the risk of losing capital, talent and long-term investment to countries that offer greater security.
“With markets unstable, and economies around the world doing their best to attract wealthy foreigners, governments need to work harder than ever to ensure that they retain sorely needed capital and talent within their borders.”
The government faces growing questions over whether its policies risk prompting an exodus of high-net-worth individuals. In April Reeves abolished the old “non-dom” tax regime, which allowed wealthy foreign residents to shield their global earnings from UK taxation.
The Office for Budget Responsibility, an independent advisory group funded by the Treasury, predicted in January that up to a quarter of non-doms would leave as a result of the change. Early payroll data suggests that departures have so far been in line with, or even below, those expectations.
The survey, conducted by the research firm Walr between July 31 and August 8, questioned 1,009 UK residents aged 18-70 with a net worth of at least £1 million. Net worth was calculated from the value of all assets, including homes. Six out of ten said their quality of life would be somewhat (31 per cent) or significantly (29 per cent) better in another country while 53 per cent said they felt less wealthy due to the rising cost of living.
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Rachel Reeves removed lucrative tax breaks for non-doms in April
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When asked which countries they were most interested in relocating to, 35 per cent said the United States, 33 per cent Canada and 25 per cent Australia. The UAE, with its zero income tax and luxury lifestyle, ranked fourth at 17 per cent.
Some 67 per cent, however, said they still saw Britain as an attractive place to invest, helped by its reputation as a global financial hub. Most of those surveyed (81 per cent) also said they still felt wealthy despite the rising cost of living and higher tax burden.
Arton said: “It’s not all bad news. While the cost of living continues to rise, and many of the wealthy are being tempted by the quality of life on offer elsewhere, the majority of those we surveyed still feel wealthy, despite the looming threat of a wealth tax.
“Whether they will still feel secure in their finances after a potential tax hike remains to be seen.”
The chancellor has promised that ending the non-dom regime and closing tax loopholes will fund an extra 40,000 NHS appointments each week. But with a projected £50 billion shortfall in the government’s books still looming, according to the independent National Institute of Economic and Social Research, officials are considering broader tax rises, including changes to capital gains tax and inheritance rules.
