Rachel Reeves has been warned that her policies are fuelling an “exodus of millionaires” from the UK, as an expert suggests £91.8billion could be lost. Figures from residence and citizenship by investment specialists at Henley and Partners indicate that the Chancellor’s stance has seemingly “backfired”, Simon Hood, Executive Director of relocation firm John Mason International, said, as the UK is projected to lose over 16,500 millionaires in 2025 alone, according to specialists.
Mr Hood said: “In the past eight months it’s fair to say we’re getting more enquiries from high-net-worth individuals than ever before, and the destinations they want to move to are all the same: it’s Dubai, it’s the States, and Qatar. It doesn’t take a genius to figure out why. These destinations in comparison to the UK are all low tax, and more importantly, high growth. Those with the means to move are thinking about relocating abroad, and why shouldn’t they when it’s in their financial interest to do so?”
In her Budget in October, Ms Reeves confirmed that she would scrap the non-dom tax status, which enabled wealthy individuals whose permanent home is outside the UK, to avoid paying full UK tax on their overseas earnings.
In January, the Chancellor announced that this policy would be tweaked to allow for a more generous phase out of the fiscal benefits.
Mr Hood added that he believes that the Government has underestimated the scale of wealthy individuals leaving the country.
He said: “We’re now in the ludicrous position where policy changes designed to raise revenue are actually costing us and driving away the very people who contribute the most.
“I don’t think they predicted the effects to quite be on this scale.”
In addition, the expert said that Ms Reeves’ decision to increase national insurance contributions (NICs) for employers have “forced many to reevaluate their long-term futures in the UK”.
Dr. Juerg Steffen, CEO at Henley and Partners, said: “2025 marks a pivotal moment. For the first time in a decade of tracking, a European country leads the world in millionaire outflows.
“This isn’t just about changes to the tax regime. It reflects a deepening perception among the wealthy that greater opportunity, freedom, and stability lie elsewhere.
“The long-term implications for Europe and the UK’s economic competitiveness and investment appeal are significant.”
Ms Reeves said earlier this year that ministers “have been listening to the concerns that have been raised by the non-dom community”.
She added: “And in the finance bill, we will be tabling an amendment which makes more generous the temporary repatriation facility, which enables non-doms to bring money into the UK without paying significant taxes.”
