‘Comedy is just tragedy happening to someone else’ said W.C. Fields (1880 – 1946) and it appears that the stand-up duo of Starmer and Reeves are having a laugh at the Non-doms’ expense whilst the Exchequer’s receipts pay the price.
Like a bad episode of ‘Carry on Bankrupting Britain’, ‘Rachel from accounts’ is tinkering with the national piggy bank under the guise of ‘everyone should pay their taxes’ but as usual is having the opposite effect.
In her maiden Budget, she opted to plough ahead with the Labour party’s longstanding promise to abolish the Non-dom status (a centuries-old regime), allowing wealthy foreigners to live in the UK without paying tax on their overseas assets and income.
In its place, she confirmed the introduction of a residence-based scheme, which will provide incentives to investors and wealthy foreigners to come to the UK temporarily, which should come into effect in April this year.
UK Lost Staggering 10,800 Millionaires in 2024
News of the amendments comes shortly after research from the global analytics firm New World Wealth found that the UK lost a staggering 10,800 millionaires in 2024, a figure which, according to the Adam Smith Institute, would have cost the Treasury the equivalent income tax take, of over half a million average taxpayers.
A national newspaper reported that “…she’s under pressure to reconsider a wealth tax on Britain’s richest households amid a growing public spending crisis…”
Elon Musk’s Garden Shed
It’s going to be imposed on those worth £10m or more, which these days by the looks of things, won’t even buy you Elon Musk’s garden shed.
And, if this trend continues, the net cost to the Treasury will be humungous.
The heroes at the Taxpayers’ Alliance have crunched the numbers thus:
In 2024–25, the top 1% of income taxpayers earned 13.3% of total income and paid 28.2% of income tax. This is up from 22.7% in 2005–06.
Shockingly, 35.6% per cent of the adult population paid no income tax at all in 2023–24.1
Chancellor Needed Blood Sacrifice
Reeves somehow didn’t realise that there is nothing more mobile than a Non-dom running from an unwelcoming tax regime. It appears that the Chancellor needed a blood-sacrifice to appease the left-wing zealots which effectively means that political dogma has superseded pragmatism. Oh dear.
Henley and Partners have noted that 10,000 millionaires have packed their designer bags and departed the UK in 2024, which was a 157% increase on the previous year.
Someone here has to do the heavy lifting and frightening off those who contribute the most will leave us all worse off.
Making the Rich Poorer Won’t Make Poor Richer
‘Making the rich poorer, is never going to make the poor richer’ – we know that from other failed socialist countries.
Let’s face it, the changes to the fiscal regime relating to Non-doms will cost the Exchequer plenty in lost revenue from Stamp Duty, VAT and PAYE, as well as their flamboyant spending habits, which keep many in employment. This is at odds with statements made by the Labour politicians before the Election, that they were going to use the monies raised from this absurd Tax proposal to pay for more doctors and nurses. I wonder if the Electorate will still support the Labour Party if it costs the taxpayers money to implement this daft Non-dom scheme? What about these apples?
If it was additional revenue that they needed, the clowns running the ‘Wastemonster circus’ just needed to raise the Non-dom fee from circa £90,000 to £200,000 or more per annum, in a similar vein to other European countries such as Italy, Portugal, Spain and France, who are welcoming these wealth creators with gusto.
This extra revenue would have brought in billions of Pounds even if the taxpayers clutches could not get hold of the worldwide wealth of these Non-doms.
Gulfstream V
The Non-dom community are very politically and fiscally savvy and rather than be ‘sitting ducks’ in the UK they are leaving with their worldly goods on their private jets quicker than you can say ‘Gulfstream V’. Lest we forget, ‘confidence arrives by foot but leaves by horse!’
Very recent press reports claim that the Chancellor has had second thoughts and is intending to amend the Finance Act to remove the more egregious elements of her plans, set out in the Budget. With such a febrile issue you would have thought she would have done her research properly beforehand, wouldn’t you?
I am hoping and praying that the unique attractions of London and the UK would be sufficient to stem the tide, but I’m not so sure anymore.
Investment can only flourish in a time of certainty. Now Reeves is trying to ape the positive Trump rhetoric that is pervading America today, yet, just three months ago Sir Kier was intoning that there was more bad news to come, and we should brace ourselves for it. These contradictory statements, which are becoming so typical of this government, create insecurity especially in the financial and property markets which are sensitive to rhetoric.
As to the elusive search for UK growth, which the Chancellor and Prime Minister are so anxious to now find, it didn’t help to impose the greatest amount of tax and borrowings in the last Budget, which by the OBR’s (Office for Budget Responsibility) own forecast is a brake on growth. Mrs. Reeves somewhat hurriedly prepared speech extolling the virtues of capital projects such as the Heathrow third runway and planning reforms are all fine and dandy but if they are implemented, they will only have a discernable effect in five to ten years, or more, time.
Someone please explain to these ‘nudniks’ that government doesn’t stimulate growth on its own since all it should and can do, is create the environment for the private sector to flourish and generate the growth, which is the antithesis of the Budget last year.
I and others like me, get the distinct impression that Mrs. ‘Desperate’ Reeves is ‘willing’ growth to take place, which I am afraid is a very close cousin to the ‘snake oil’ salesman version of economic theory.
A Rich Seam of Hong Kong/Chinese Oligarchs
Along the north-west London corridor we have not yet seen an avalanche of super-prime properties for sale. Spring will give us a clearer picture when these uber-international purchasers return (or not) from their Alpine or Caribbean retreats.
It’s too early to tell whether residential property values in the uber sector will be affected for this reason. Although we are short of wealthy buyers there is still not an excess of properties for sale in the higher sector coming onto the market.
As we speak, using our global reach, we are exploiting a rich seam of Chinese/Hong Kong oligarchs who buy or rent exclusively through Glentree and certain uber transactions which are currently under negotiation will be known to the marketplace shortly and will dilate the pupils of the cognoscenti.
The precedent of the billionaire, high tech, individual who has just bought The Holmes in Regents Park, admittedly for a knock down price, is a good example that for the sophisticated, international investor, the attraction of London and its 45% green open spaces is irresistible and unique in the world.
Massive bout of Class A Foot-Shooting
Britain is not the only country afflicted with this wealth-grabbing insanity. The Spanish ruling class has indulged in a massive bout of Class A foot-shooting, by imposing a 100% penalty for any non-EU resident purchasing a property in the country. This is utterly ‘muy loco’ and it’ll be interesting to see if they have the ‘cohones’ to implement such a ridiculous regime, especially when their debt-to-GDP ratio is 105.1%.
It saddens me that this wonderful country has become ‘Not-so-Great Britain’ and is languishing in the doldrums. Our colonial cousins across the Atlantic have had the good sense to elect someone who is for ‘The People’, and not bent on political dogma. Attacking our brightest and wealthiest can only drag us down further. Instead of making an enemy of these talented and entrepreneurial visitors, Labour should embrace and nurture them as a national treasure and utilise the gains for all of our benefit.
Fizzing and Effervescent Excitement in USA
The gloom and doom that abounds at the moment in the UK is in stark contrast to the fizzing and effervescent excitement in the USA about President Trump, who seems to be vividly demonstrating that ‘there is a new Sheriff in town’ and change is afoot.
1. www.taxpayersalliance.com/briefing_share_of_income_tax_paid_by_percentile
By Trevor Abrahmsohn, Glentree International