High taxes, deteriorating healthcare system prompt millionaires to live somewhere else
The United Kingdom (UK) has been witnessing an exodus of millionaires in the last few years and will continue to lose thousands of high-net-worth individuals (HNWIs) this year, as the wealthy migrate to new destinations due to high taxes and deteriorating healthcare system, according to a new report.
From 2017 to 2022, the UK lost approximately 12,500 more HNWIs than it has gained through migration, and it is expected to lose another 3,200 HNWIs in 2023, New World Wealth said in a report released on Wednesday.
The report said the millionaires have been leaving the UK to live in top destinations like Dubai, Paris, Monaco, Amsterdam, Sydney, Singapore, New York, Frankfurt, Silicon Valley, Toronto, Marbella, Geneva, Miami and Palm Beach, among others.
The UK, particularly London, has traditionally been regarded as a hub of the rich. For several years, from the early 1900s to 2010, the country consistently drew large numbers of wealthy migrants from Europe, CIS, Asia, Africa and the Middle East.
“However, this trend began to reverse around a decade ago as more millionaires left the country and less came in,” the report said.
The report also noted that London has been “particularly hard hit” by the exodus of rich people, particularly those at the top-tier segment.
Two decades ago, London topped the charts in terms of centi-millionaire numbers, but it now ranks fourth by this measure behind New York City, the Bay Area and Los Angeles.
“It is also quickly being caught up by Beijing, Shanghai and Singapore,” the report said.
Reasons for the millionaire exodus
One of the possible reasons that encourage wealthy people to move out of the UK is the high cost of taxation.
The British capital gains tax and estate duty rates are one of the highest in the world and they deter wealthy retirees from living there, the report noted.
The healthcare system in the UK is also “deteriorating”, while there have been “increasing safety concerns” especially in the big cities.
A considerable number of British millionaires have also relocated to other parts of Europe over the past few years possibly as a result of Brexit, with the bulk of the migrants working in the financial services space or are retirees.
“The growing dominance of USA and Asia in the global hi-tech space has [also] caused several wealthy UK tech entrepreneurs to reconsider their base location,” the report said.
(Writing by Cleofe Maceda; editing by Seban Scaria)