UK Set to Be Worst in the World for Millionaire Exits as a Share of Population Within This Parliament
The UK is set to lose greatest proportion of millionaires in the world over the course of this parliament;
According to new analysis by the Adam Smith Institute, a leading economics think tank, the share of the population who are millionaires will fall by 20% by 2028;
Today, 4.55% of British residents are millionaires, but the ASI has forecast that this will fall to 3.62% by 2028;
The fact that the UK is losing proportionately more millionaires than China or Russia is a worrying indicator of our economic health and growth prospects;
Many millionaires are wealth creators who set up businesses and employ people across the UK;
They also pay a significant share of taxation, funding Britain’s public services;
Millionaires are leaving the UK for a number of reasons, including high levels of current taxation, threats of further increases, a hostile culture towards wealth-creators and , the abolition of the non-dom regime, and a culture which is hostile to wealth-creators;
Former Chancellor of the Exchequer, Nadhim Zahawi, urges the Government to rule out measures in the Budget targeted at high net worth individuals. Instead, the Chancellor ought to cut or abolish anti-prosperity taxes.
The Millionaire Tracker is a new initiative from the Adam Smith Institute (ASI) which calculated the proportion of the population who are millionaires, and how this is forecast to change over time.
According to their new analysis, the share of the population who are total millionaires, which means they have at least 1 million US Dollars across all asset classes, including shares, property, pension funds and cash, will fall from 4.55% to 3.62% before the end of this parliament. That is a decrease of 20%.
As the leading think tank highlights, this could be seriously damaging to the UK economy. Millionaires pay a significantly greater share of tax, especially income tax, which is the Exchequer’s largest source of tax revenue. The top 1% of earners pay 29.1% of income tax.
Millionaires are leaving the country for a number of reasons, including the changes to, and the proposed abolition of, the non-dom tax status, high levels of general taxation, and a hostile culture for wealth creators.
To reverse this trend, the Adam Smith Institute calls on the Government to make the tax environment more welcoming to wealth creators. In particular, it suggests the abolition of inheritance tax, cuts to Capital Gains Tax and an international competitiveness assessment on the UK’s tax and regulatory treatment of non-doms and High Net Worth Individuals (HNWIs).
The Rt Hon Nadhim Zahawi, former Chancellor of the Exchequer, said:
“The rate at which millionaires are leaving the UK is a vote of no confidence in both our current tax and regulatory regime, and anti-business and anti-prosperity measures that could be coming down the line.
These individuals are often entrepreneurs and business owners. Their exit won’t just reduce necessary funds for public services- it will decrease investment in the wider economy too.
I urge the Government to rule out anything in the Autumn Budget on the 30th October that could drive them away even more. They should instead be focusing on attracting more millionaires from across the world to make a home and set up shop in Britain. Abandoning anti-non-dom policies and abolishing or cutting anti-wealth taxes would be a vital first step.”
Maxwell Marlow, Director of Research at the Adam Smith Institute, said:
“These findings should be a wake-up call to the Government. The more millionaires who leave the UK, the worse the impact on the economy will be.
It’s important to understand that High Net Worth Individuals aren’t only leaving in response to the UK’s uncompetitive tax and regulatory regime, the proposed abolition of the non-dom status, and the threat of increased taxation. They are understandably also reacting to a culture that is increasingly hostile to wealth creators. As long as we continue along this path, we can hardly be surprised that so many millionaires want to leave.
This trend is not set in stone. We need to take a comprehensive review of our tax and regulatory treatment of millionaires and reconfigure it to attract more of them to our shores, as well as creating more of them at home.”
--ENDS-
Methodology:
The Adam Smith Institute utilised data from New World Wealth and UBS/Credit Suisse wealth reports, as well as national data office population data and forecasts, for each respective nation. We calculated the number of millionaires within the country per capita, and utilising UBS/Credit Suisse forecasts for millionaires in 2028 against population forecasts provided by the ONS, and calculated the forecast exodus of millionaires. This was calculated as both a percentage of millionaires against the overall population, and against the population of millionaires today. We also utilise the Governmental census bodies of other applicable countries from other nations mentioned in the UBS/Credit Suisse and New World Wealth reports.
As our analysis is based on UBS/Credit Suisse’s data, where they investigated 36 separate countries, there will be gaps in the data we have utilised for our tracker. Likewise, New World Wealth’s data, comprising 24 countries was utilised for liquid millionaires and may reflect similar criticisms over proportionality and gaps for non-measured countries. Our report concentrates on the G7, OECD, and other global economic peers.
Notes to editors:
The report is available on a private website link here. Please use password ASIMT24
For further comments or to arrange an interview, contact Emily Fielder, press@adamsmith.org | 0758 477 8207
The Adam Smith Institute is one of the world’s leading think tanks. It is ranked first in the world among independent think tanks and as the best domestic and international economic policy think tank in the UK by the University of Pennsylvania. Independent, non-profit and non-partisan, the Institute is at the forefront of making the case for free markets and a free society, through education, research, publishing, and media outreach.
