As the UK grapples with new economic policies under the Labour government, an alarming trend is unfolding—an exodus of millionaires seeking friendlier financial climates abroad. Since the general election was called, one dollar millionaire has left Britain every 45 minutes. With sweeping tax reforms, particularly the abolition of the non-domiciled (“non-dom”) tax status, high-net-worth individuals are reassessing their financial futures—and increasingly deciding that the UK is no longer the best place to preserve their wealth.
Why Are the Wealthy Leaving?
The driving force behind this millionaire migration is taxation. Labour’s move to replace the centuries-old non-dom tax regime with a stricter residence-based system means that foreign income, once protected, will now be subject to UK taxation. Additionally, the introduction of inheritance tax (IHT) on overseas assets has sent shockwaves through the high-net-worth community, with many unwilling to see their estates diminished by UK tax laws when other jurisdictions offer more favourable conditions.
According to the Henley Private Wealth Migration Report, Britain lost a net 10,800 millionaires in 2024—a staggering 157% increase from the previous year. The outflow was particularly severe among centi-millionaires (those with over £82 million) and billionaires, many of whom are now setting up residency in Switzerland, Italy, and the UAE.
The Economic Impact of the Exodus
While the Treasury expects the end of the non-dom regime to generate an additional £2.5 billion in revenue annually, economists warn that the true cost of this policy may be far greater. If even a quarter of non-doms leave, as predicted, the UK stands to lose billions in tax revenues, investment, and philanthropy.
A report by Oxford Economics found that each non-dom contributed an average of £800,000 in VAT last year, alongside £890,000 in stamp duty over the past five years. Beyond direct taxation, non-doms have invested an average of £118 million in the UK and donated approximately £5.9 million to charitable causes. Their departure, therefore, doesn’t just impact the Exchequer—it has broader implications for businesses, job creation, and even philanthropy.
Where Are They Going?
Many departing millionaires and billionaires are opting for more favourable tax jurisdictions:
- Switzerland: Long regarded as a haven for the wealthy, Switzerland offers a fixed tax arrangement based on residence, rather than a worldwide income model.
- Italy: A relatively new player in wealth migration, Italy has introduced a special flat-tax scheme for high-net-worth individuals, making it a desirable alternative.
- UAE: The Emirates, particularly Dubai and Abu Dhabi, continue to attract wealthy expatriates with zero income tax and a luxury lifestyle.
- Spain & Portugal: Despite changes to Portugal’s Golden Visa programme, both nations remain appealing for their relaxed lifestyle, warmer climate, and (in some cases) tax incentives.
The Wider Implications for the UK
Beyond the immediate loss of tax revenue, the flight of the wealthy could have lasting effects on the UK economy. Businesses that cater to high-net-worth individuals—ranging from luxury goods and real estate to legal and financial services—stand to suffer from diminished spending. In turn, job losses in these sectors could follow.
Moreover, Britain’s attractiveness as a hub for international business may take a hit. With increasing global competition to attract wealthy investors, the UK risks being seen as a less competitive destination for wealth preservation and investment.
Is There a Way to Reverse the Trend?
Some business groups and economists are urging the government to reconsider elements of its tax strategy. One proposed solution is a tiered tax system, where non-doms would pay a fixed fee depending on their wealth, rather than being subject to the same tax rules as full-time UK residents. This compromise could allow the UK to retain its high-net-worth residents while still ensuring they contribute fairly to the economy.
Other nations have successfully implemented such models, allowing them to benefit from the presence of wealthy individuals without discouraging them from remaining. If the UK does not act swiftly, it risks losing a crucial segment of its economic base to more accommodating global competitors.
A Defining Moment for the UK’s Economic Future
The exodus of millionaires is not just a political talking point—it’s a major economic shift with real consequences. While Labour’s tax plans aim to create a fairer system, they may inadvertently be pushing out the very individuals who drive investment, employment, and philanthropy in the UK. Whether the government will adjust its policies in response remains to be seen, but for now, the trend of the wealthy leaving Britain appears to be accelerating.
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