Rachel Reeves has been criticised as people with wealth in the UK have reportedly started moving their money abroad after the Chancellor’s Budget.
Ms Reeves announced an increase to employers’ National Insurance contributions in October, as well as an increase in the basic rate of capital gains tax (CGT) on profits from selling shares, which will go from 10% to 18%. The higher rate will rise from 20% to 24%.
A survey by deVere Group, an independent financial advisory and asset management organisation, has found that 42% of those with financial assets in the UK or ties to the country are actively now seeking to transfer their wealth out of Britain.
Instead, they are opting for “more tax-friendly” jurisdictions.
Among the most popular destinations for those reassessing their strategies are Italy, Switzerland, Dubai, Portugal and Malaysia, research found.
The findings revealed what has been described as a “seismic shift” in attitudes toward the UK’s financial environment.
Families, business owners and investors with UK financial connections are exploring options to “mitigate the impact of the new tax landscape”, deVere reported.
Rachel Reeves’s policies have been criticised (Image: Getty)
People are moving their wealth from the UK to places like Italy, deVere suggests (Image: Getty)
Nigel Green, chief executive of deVere Group, said: “These measures, designed to address fiscal challenges, are perceived as a direct threat to wealth preservation and financial planning. The policies outlined in the Budget are a game-changer for anyone with financial ties to the UK.”
He went onto say that the poll shows a “remarkable increase” in the number of individuals seeking to reposition their wealth abroad.
Mr Green said that this is “not a knee-jerk reaction” but rather a “strategic response” to an environment that has become “increasingly hostile to wealth and investment”.
He added: “The abolition of the long-standing non-domiciled tax status has emerged as a pivotal concern. Historically, this status has attracted significant investment and talent to the UK, fostering a dynamic business environment.
“Its removal sends a strong signal that the UK may no longer be the tax-friendly hub it once was. For those with property, business interests, or pension plans tied to the UK, this represents a significant shift in financial risk.”
Rachel Reeves is reportedly causing an exodus of wealth (Image: Getty)
He also said: “The increase in CGT rates is set to discourage investment, while the inheritance tax changes on pensions create additional complexities for families planning to pass on wealth to loved ones efficiently.”
It has also been claimed that the measures “prioritise immediate fiscal gains over long-term economic growth”.
Mr Green added: “By imposing higher taxes on wealth and on business, the Government risks driving away the very individuals and enterprises that contribute significantly to the UK economy.”
Also announced in the Budget was that inheritance tax relief for farms will be limited to £1million.
