Self-Destructive Class Warfare in the United Kingdom, Part II (high taxes sending the rich away)

By Dan Mitchell.

"Last year, in Part I in this series, I warned that the United Kingdom was pursuing a “sure-to-fail policy.”

More specifically, I explained that the class-warfare attacks on upper-income taxpayers were going to backfire for the simple reason that entrepreneurs, investors, and business owners could “vote with their feet” by moving to nations with better policy.

Which is exactly what’s been happening.

Today’s column will share fresh evidence on the consequences of the U.K.’s suicidal tax policy.

We’ll start with some excerpts from a new story in Bloomberg by Benjamin Stupples.

The exodus of the uber-rich from the UK has become a $160 billion problem. That figure, calculated using data from the Bloomberg Billionaires Index, lays out for the first time the vast amounts of money and assets behind those quitting Britain. It’s the total wealth represented by individuals tracked in the list who have loosened their ties with the UK — or cut them entirely — just in the past two years. …Tax changes targeting the wealthy since Labour came to office in 2024 are taking a growing toll…and near constant speculation that more measures are coming, has dramatically frayed the relationship between the well-heeled elite and the government. …The top 1% of UK earners account for about 27% all income tax revenue, according to government figures. When they leave, they also take their hefty spending power. …Half of the overall group finalized their departures from the UK — to territories spanning Monaco, Switzerland and the United Arab Emirates — in the weeks leading up to Labour bringing in sweeping tax reforms in April 2025.

Here’s a chart from Bloomberg listing the rich people who have escaped.

But that list is incomplete.

Today’s news adds even more evidence. As reported by Maira Butt for the Independent, another wealthy taxpayer has decided that the United Kingdom is no longer a good place to live.

Instead, he has decided that zero-income-tax Monaco is a good place to reside.

A billionaire who formerly topped the Sunday Times Rich list has become the latest wealthy businessman to leave the UK to take up residence in Monaco. David Reuben, 88, is a property tycoon and Newcastle United shareholder, who along with his younger brother Simon Reuben, has a combined estimated net worth of nearly £28bn. …A spokesperson confirmed to the publication that the property tycoon had moved to Monaco but declined to comment further. …Last week, billionaire Manchester United owner Sir Jim Ratcliffe complained that Britain’s billionaires were leaving as the country was “on the slide” and blamed high taxes and high immigration for the decline. The remarks followed the departure of several of the UK’s highest earners… More than 10 per cent of the total wealth identified in the Rich List is controlled by UK citizens who now reside in Monaco, a total of £77bn, according to The Times.

I’ll close with the depressing observation that the out-migration of successful taxpayers began when the so-called Conservative Party was in charge.

Because they were fiscally irresponsible, they imposed class-warfare taxes.

Once the Labour Party took over, they doubled down on that misguided approach.

The only silver lining to this dark cloud is that we’re getting more evidence for the Laffer Curve.

P.S. One takeaway from today’s column is that the U.K. desperately needs Milei-ism."