Britons and UK-based wealthy foreign nationals may run away from Britain and take their funds with them after the next general election, predicted deVere Group’s chief executive, Nigel Green.
Green’s comments came after a leading think tank warned that tax hikes of up to GBP9 billion, which equates to 2p on the basic rate of income tax, are likely to be imposed after the next election to plug the hole that will be left in the government’s finances following the spending cuts scheduled for 2015 that were announced in George Osborne’s budget.
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Green said: "The astute number crunchers at the Institute for Fiscal Studies have shown that the government will have little alternative but to borrow more or increase taxes to pay for the Chancellor’s budget. As this is after an election, a time when MPs can more afford to take controversial measures, it is highly probable that the new government would opt for the former – taxes would be hiked up.
"A tax hike could be the tipping point for many high-net-worth and ultra-high-net-worth individuals, who are the most mobile in society due to their abundant resources.
Green also added that the "so-called high tax Britain is set to become even higher tax Britain".
"I would fully expect there to be something of a wealth exodus from the UK as wealthy Brits and non-domiciled taxpayers in the UK seek to move themselves and assets to lower-tax jurisdictions in order to safeguard their funds. Whilst proponents of tax hikes try to dismiss any notion of a global phenomenon of tax migration, both current examples and history prove just the opposite. It’s clear: when high-net-worth individuals are taxed to perceived excessive levels, they simply move – because they can. They are, in effect, taxed out."
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