This report is from the UK exchange newsletter for this week. Every Wednesday, Ian King brings you experts about the most important working stories from the United Kingdom and the main characters that make up news. The newsletter will also shed light on other major developments in the UK that you will not want to miss, as well as a preview of the basic events that are set for surfing. Like what you see? You can subscribe here.
Transmission
For most of this century, the United Kingdom – and London in particular – was one of the most popular destinations for the world’s rich people to live, work and play in it.
The best summed up by Peter Mandleson, the UK’s approach to this period, and is the oldest minister in employment governments in Tony Blair, Gordon Brown and the UK’s ambassador now in the United States. In 1998, he told a group of Silicon Valley leaders: “We are very comfortable with getting rich people as long as they pay their taxes.”
However, this is now changing as the wealthy fleeing a new punitive tax system, with potential consequences for the country.
It can be said that this started when Russia invaded Ukraine in 2022 and left hundreds of few Russians after imposing sanctions on it. This was in itself useful; Marmket Aston Chase estimated that at the time of the invasion, about 150,000 Russians lived in “Londongrad” owned at 1.1 billion pounds ($ 1.5 billion) of residential property.
But this was a specific Russian issue, regardless of those who benefited from Russian activity, a few dug their departure.
Things began to change more broadly during the general election period for the last year, when Jeremy Hunt, the consultant in the treasury, sought to steal his competitors’ clothes in his budget in March 2024.
He announced that, as of April 2025, the United Kingdom will take place Cancel the so -called “non -always” mode – It was one of the tools of the tax system dating back to 1799, which allowed the wealthy living in Britain, but they did not consider their permanent home, or “home”, to pay the UK tax only on the income gained in the country or transfer it to the country.
This was the leading work policy, and the straw work has made the fact that Akshata Morti, the wife of Rishi Sonak, the baby, the former Prime Minister, was one of about 74,000 people who enjoyed a spiral position in 2022-23 (the last tax year available numbers).
Hunt claimed to replace the state of insecurity with his “simple accommodation system” to collect 2.7 billion pounds annually. Nevertheless, he chose not to subjugate the external assets placed in external boxes by not defending the inheritance tax in the United Kingdom.
When the Labor Party won the elections, in July last year, the newly designated chancellor Rachel Reeves decided that she needed to maintain the party’s leadership on this issue. So it is The exemption canceled On external confidence – it is possible that the entire global wealth of these individuals will display a 40 % tax.
Overnight, the United Kingdom has turned from one of the most attractive destinations for the world’s richest people into one of the most expensive places in the world.
The result was a migration of the super wealthy.
The rich exit
It is difficult to know exactly the number of people who left. New World Wealth New World Wealth and Henley & Partners in March this year suggested that Britain had lost a net 10,800 million migration in 2024, an increase of 157 % in 2023 and more than any other country except China.
Some of these numbers, including Stephen Kinsella, a legal advisor and member of the national millionaires in the United Kingdom, is a non -partisan network of British millions who are calling for wealth tax. He recently told me that the numbers were an induction dependent on the number of people on LinkedIn who said they had left.
He added: “There are about 3 million millionaires in Britain, so even if 10,000, this will be about 0.3 % of the million.”
Henley & Partners and New World Wealth published a new report last week, expecting that 16,500 million of the millionaire will leave the United Kingdom this year, and more than twice what was expected, representing the highest net flow to individuals of high value from any country since they started tracking immigration a millionaire 10 years ago.
Street scene on Bond Old Street, Mayfir, London, UK.
Powell Lieberra Photo Bank Gety pictures
Although the actual numbers will not be known until the UK tax authorities will incur numbers a few years away, there was a lot of straw in the wind. Lonres, which tracks the activity in the main real estate markets in London, Estimates There were 36 % of the transactions that involve these homes in May this year of what they were in the same month last year. At the same time, companies include companies’ data Suggest More than 4,400 UK manager left last year, with the acceleration of departure in recent months.
Among those who left some of the very prominent individuals, including Richard Noddi, Vice President of South Africa, Goldman Sachs, was the Vice President of South Africa; Nassef Sawiris, the richest man in Egypt and a co -owner of Aston Villa FC, John Friedrixen, the generated Norwegian charging pole. Lakshmi Mittal is said to be a hard -born billionaire billionaire in India, which regularly leads the richest Britain, weighing his options and is widely expected to abandon his tax residence in the United Kingdom.
What makes the problem increases is that other countries are currently welcoming the wealthy with open arms. It includes Italy, where Gnodde has been transferred, allowing wealthy foreigners to pay Annual fees of up to 200,000 euros To exempt their assets and entered them abroad from the tax. Nevertheless, the upper destination for migratory millions is the United Arab Emirates, which is now home to Samiris and Fredriksen. The latest Henley & Partners/New World Wealth predicts that it will attract a net 9800 million this year.
None of this has yet appeared in financial expectations in the United Kingdom. In fact, the independent budget responsibility office is still assumed that the Reeves step will collect 2.7 billion pounds of additional taxes annually by 2028-29. It is assumed that between 12 % -25 % of non -servers will go, which now seems less than reduce.
Research published by Consulting in Oxford suggested the economy in September last year, based on a survey of non -servers and its consultants, that 63 % will leave within two years of implementation. Aside from the survey, Oxford Economics expects to leave up to 32 % of non-states and under this scenario, as non-defense paid 8.9 billion pounds in the period 2022-23, and policy begins the cost of treasury funds.
Not only the excessive taxes that these people would have paid. Thousands of jobs in sectors such as retail, hospitality, legal services and luxury goods depend on the continuous presence in the United Kingdom for the previous regions. Dozens of charitable institutions and cultural and sports institutions depend on their care and charitable work. So there will be a much wider effect than just the financial effect.
Late, the government realized that it had a problem. Unfortunately, it may have been too late to seduce those who have already done others, along with others who left because of the value -added tax imposed on school fees and changes in relief from agricultural property and relief from commercial property that has been exposed to queens exempt and business tax on inheritance tax for the first time.
However, the government is still acting to stop the additional departure. The most effective thing to do is restore the exemption from the inheritance tax granted to external boxes. This will be a problem for Reeves, because imposing taxes on wealthy people are more popular among workers, even when – as suggested by one poll last weekend – it hurts me with public financial resources.
But the counselor needs to find a way to retreat without seemed very similar to it. And with many wealthy people looking to move in a timely manner to start the new academic year in September, it may not leave it even the autumn budget.
Ian King
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