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Britain’s millionaires exodus to double amid private school tax raid

keir starmer labour tax rises
Labour's tax policies are predicted to push very wealthy individuals to low-tax countries - Stefan Rousseau/PA Wire

The number of millionaires leaving Britain is expected to double this year amid Labour’s tax raid on non-doms and private schools.

A record 9,500 people with assets, excluding property, of $1m (£790,000) or more, are forecast to leave the country in 2024, according to expat wealth manager Henley & Partners. Last year 4,200 millionaires left.

It comes as Labour revealed plans to strengthen the Conservatives’ non-dom reforms in its manifesto last week. Both parties have said they will make the non-doms regime less generous but Labour went further.

The party pledged to raise £450m by closing a loophole that allows non-doms to avoid paying inheritance tax on assets held in trusts.

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Advisers to non-doms have warned that many wealthy foreigners will exit the country if they are forced to pay the 40pc charge. Britain’s inheritance tax rate is one of the highest in the OECD group of leading economies.

Henley & Partners’ annual private wealth migration report is based on data on more than 150,000 high-net-worth individuals. The firm found that the number of millionaires in the UK has dropped by 8pc over the past decade while in other countries the figure is rising. For example, France has seen its millionaire population grow by 14pc and Australia’s has soared by 35pc.

This year’s report said that the UK will lose the second-most millionaires of any country, overtaken only by China, which is anticipated to lose 15,200 wealthy residents.

Hannah White, of the Institute for Government, a think tank, said economic and political turmoil in the UK had already triggered an outflow of millionaires but this was now being accelerated by hostile policy decisions ahead of the election.

“For those educating their children in the UK’s well-regarded private school sector, Labour’s commitment to remove their exemption from 20pc VAT is a further unwelcome development,” she added.

Around the world, 128,000 millionaires will relocate in 2024, more than in any year previously, Henley & Partners said.

The firm said China would suffer the biggest outflows and that these would be “more damaging than usual” to its economy because of the recent slowdown.

Meanwhile, other countries with low taxes and golden visas are expected to gain thousands of millionaires this year. The United Arab Emirates is top of the list, attracting 6,700 from countries such as India, the Middle East and Russia as well as the UK. Next is the US, which is predicted to draw in 3,800 high-net worth individuals and Singapore with anticipated inflows of 3,500.

Dominic Volek, of Henley & Partners, said: “As the world grapples with a perfect storm of geopolitical tensions, economic uncertainty, and social upheaval, millionaires are voting with their feet in record numbers.”

According to another report published last year, from Swiss bank UBS, Britain fell into sixth place in the global ranking of millionaires. There were 2.5 million people with assets of £1m or more, compared to 2.8 million in France, 6.2 million in China and 22.7 million in America.