Hedge fund billionaire Chris Rokos has announced his relocation to Athens, Greece, marking a significant departure that highlights a broader trend of "wealth creators" leaving the United Kingdom due to its tax regime. Rokos, who recently donated £190 million to Cambridge University and paid £330 million in income tax, cited the more favorable tax environment in Greece, where foreigners pay a flat rate of 100,000 euros on income earned abroad, compared to the UK's approximately 40% tax on earnings.
Rokos's move is indicative of a larger pattern, with several high-profile individuals and investors choosing to relocate. German-born investor Christian Angermayer moved to Switzerland, calling Labour's tax changes a "death blow" to London. Norwegian shipping magnate John Fredriksen closed his Chelsea office and moved to the United Arab Emirates, stating Britain had "gone to hell." Slavica Malic, formerly married to F1 tycoon Bernie Ecclestone, also relocated to Monaco, expressing dissatisfaction with tax authorities.
The article suggests that these departures are not merely about individual preferences but have a substantial economic impact. The top 1% of earners in the UK, earning £207,000 or more, contribute nearly 13% of the total income tax collected by HMRC. The wealthiest 11,000 individuals, each earning over £2 million annually, paid as much in income tax as the bottom 10 million earners combined in the last fiscal year. The loss of even a few of these individuals can create significant financial gaps for the Exchequer.
Other notable departures include pharmaceutical heiress Lady Ballyedmond, who moved to Italy; kitchens tycoon Malcolm Healey, who relocated to the US; and metals magnate Lakshmi Mittal, who announced his departure earlier this year. According to the Sunday Times Rich List, the number of billionaires residing in the UK has fallen from 177 in 2022 to 157. A third of individuals in the top 350 of the list are no longer UK tax residents, and one in six from two years prior have left.
This trend is partly attributed to policy changes, such as the abolition of the 'non-domicile' tax status in April of the previous year. This change, which removed preferential tax treatment for certain foreign residents on their worldwide income and gains, has been cited as a major factor driving clients overseas, according to tax and immigration adviser David Lesperance. He noted that all 20 of his UK-based clients with net worths exceeding £370 million have now relocated.
Concerns are rising that the UK's fiscal regime is becoming increasingly unattractive for investment and wealth creation. Mark Goddard, UK chief executive of Swiss bank Lombard Odier, warned that fiscal policy was making the UK an "excruciating" place to invest and that entrepreneurs were considering leaving. Herman Narula, founder of Improbable, a metaverse infrastructure firm, also cited concerns about a potential "exit tax" on business leaders leaving the UK.
While countries like Dubai and Israel are noted as beneficiaries with no inheritance tax, European nations are also capitalizing. Italy offers a flat tax of 300,000 euros on foreign-sourced income, and Portugal is popular for its "quality of life." Thailand offers a system similar to the UK's former non-dom regime. Greece, in particular, has actively attracted high earners with its 100,000 euro flat tax for foreigners introduced in 2020, drawing figures like tennis star Novak Djokovic and hedge funds such as Millennium Capital Management.
The article posits that reversing this trend is challenging, as once individuals have relocated and settled, the friction of returning is significant, especially when alternative locations offer zero tax on foreign earnings. The ease of moving abroad, once demonstrated by a few, becomes more tempting for others, potentially leading to a substantial loss of expertise, future tax contributions, and investment in the next generation of British businesses.