Thor Björgólfsson, identified as Iceland's first billionaire, has relocated his tax residency from the United Kingdom to Italy and moved his investment firm, Novator, from London to Zurich. Björgólfsson's departure follows the UK's introduction of the Foreign Income and Gains (FIG) Regime in April, which replaced the previous non-domiciled tax status.
He described the movement of wealthy individuals out of Britain as an "exodus" and expressed concern about the rapid pace of these departures and their wider economic impact. The non-dom tax status allowed certain UK residents to avoid paying full UK tax on income earned abroad. The new FIG regime offers exemptions for foreign earnings for four years to wealthy arrivals who have not been UK residents in the preceding decade.
Björgólfsson joins other high-net-worth individuals who have shifted their tax residency, including Nassef Sawiris, co-owner of Aston Villa FC, who has also moved to Italy. Brothers Ian and Richard Livingstone, managing a significant property portfolio, have relocated to Monaco.
Björgólfsson, who was a major shareholder in Iceland's Landsbanki before its collapse in 2008, suggested that the UK government may have made a mistake with the tax policy changes. He proposed the adoption of a flat-rate tax system, similar to that in Italy, to cap the tax liabilities for entrepreneurs and business leaders.
Other prominent figures have also voiced their dissatisfaction with the UK's tax environment. John Fredriksen, described as Britain's ninth richest billionaire, moved his shipping firm from London to the United Arab Emirates last year, stating that the UK had become a less favorable place for business. He has also expressed a preference for a more demanding work culture.
The abolition of the non-dom tax status by the Labour government was intended to address perceived tax unfairness and was projected to raise approximately £2.7 billion for the Treasury by 2028-29. A Treasury spokesperson stated that the UK remains an attractive place to live and invest, highlighting competitive capital gains tax rates and a simplified residence-based tax regime.