There was no magical property of London that attracts people DESPITE higher taxes.
Very difficult to have any policy discussion when a second order effect is involved.
It shows that trickle down economics doesn't happen.
The harm you're looking for is massively inflated asset prices, for example pushing housing out of the affordable range of normal residents and the actual tax payers.
So the mega rich turn out to be parasites in many ways.
that’s a very sinister way to describe the reward for their extraordinary efforts. who’s putting money in their hands? where did this ‘who’ get the money from?
starting and running a successful business is extraordinary effort. my life is better thanks to founders of all the companies whose good and services i depend on. i’m full of gratitude for their extraordinary efforts because they’ve made life worth living.
If we're talking about foreign oligarchs living in London, I suspect a fair amount of the money is coming from Russian organized crime.
Taxing the billionaires is a net plus for any economy.
Is there's a serious hike in taxes the billionaires will just leave and open companies elsewhere
If these non-dom billionaires leave, and they aren't currently paying tax, will we even notice?
The housing market noticed; again from the article, the value of properties valued above £10m dropped by 37%. So these "just leavers" aren't just leaving, they are taking a near 40% hit on selling up.
So basically just hoping that billionaires spend and trickle down.
if the uk wants tax money on revenue maybe they should incentivize these so-called super-rich to run their affairs from within the uk?
I think the optics are clearly bad but the question I think people really have to ask is what they rather these people paying something in the country, or nothing at all (because there’s nothing keeping them there if it’s viewed as too expensive to stay)
Very unfortunate. Brexit didn't bring as much damage as some might expect. But this new government, or may be even previous government as well all compounded to the decision happening now.
I did a quick check and it seems like non dom's are about 0.11% of UK residents and pay about 1.24% of UK taxes. And this doesn't account for indirect benefits such as taxes paid on wages they generate.
Sounds like it worked out as planned, since they're leaving now.
Plus, 40% inheritance tax is crazy. You'd have to sell off half of what you inherit to pay the tax. Sucks if you're a farmer or a multigenerational family business
There are also ways to reduce the tax rate, like through charitable donations.
Like in the US with estate taxes, relatively few people are affected by it.
It's also relatively easily defeated by transferring assets to others well in advance of your death, which is the kind of thing very wealthy people are more likely to be able to arrange.
> a centuries-old tax loophole, abolished in April, that catered to the global rich. The nondomiciled—or non-dom status, as it is known—allowed foreigners living in the U.K. to pay tax only on what they earned domestically. Profits made abroad were ignored unless brought into the U.K.
If I happen to work for a foreign corporation, I don’t get to skip paying tax.
Most of the world taxes only income earned in that country.
> If I happen to work for a foreign corporation, I don’t get to skip paying tax.
Sure, because you earned it your country, and not in the country of domicile of foreign corporation.
EDIT: Correction, I see now that most countries do tax worldwide income, just that they have DTA so you offset taxes paid abroad.
It's only the US which taxes worldwide income. It's not true for rest for the world.
https://taxsummaries.pwc.com/ireland/individual/taxes-on-per...
Still the common norm is that PIT is only levied on income earned in the country.
https://europa.eu/youreurope/citizens/work/taxes/income-taxe...
You mentioned Estonia in another comment - it might be the case that Estonia is a special case or has a scheme for attracting talent that doesn’t include worldwide tax
I see now that most countries do tax worldwide income, just that most of the time they have DTA agreements so you can offset tax paid in other countries against your tax bill.
“Failure” is of course subjective, but I would say that the gargantuan increase in wealth inequality is a datapoint in favour of suggesting that its a failed model.
Post-War consensus Britain was a golden age, and neoliberalism has been harmful to the quality of life for an overwhelming number of British people. This is just factual, by all the data we have.
Deng Xiaoping's "let some people get rich first" worked out pretty well.
The people who hoard the wealth in the US actively attack regulation and avoid taxes so that they don't have to redistribute the wealth. At that point, you're a drain on the system.
Source? Aside from some lip service paid about "common prosperity", China definitely does not have a strong wealth redistribution system. I can't find good metrics on size of welfare systems specifically, but using the crude metric of government revenue as % of GDP, it's clear that China isn't some sort of global leader in redistribution.
https://en.wikipedia.org/wiki/File:Government_revenues_as_a_...
I don't think this does your argument any favors because by your words, it didn't work. Because you're right, China's "let a few people get rich" idea led to massive wealth inequality but redistribution was always at the center of the idea and what I'm talking about are recent reforms that Xi is taking to accelerate that redistribution such as and introducing salary caps, increasing taxes, and creating more social security programs the rich have to pay into. So China is right now building their strong wealth redistribution network.
and its gdp growth, prosperity, and investment rate going down at an exactly same rate…
"GDP growth" and "investment rate" are just really terrible proxy indicators for the thing most people actually care about, i.e. quality of life for the common person. Without context they're just distasteful weasel words that strongly imply that GDP is somehow representative of the quality of life, which only serves to trick people into voting against their own interests.
We don't need a bigger market for luxury dog sitters or sports car manufacturing, better allocate those resources for childcare, elder care, or other chronically understaffed fields.
edit: The reality is they don't spend enough for it to offset the harms that wealth inequality brings.
I know a couple of people who have been using this London loophole as a way to avoid paying taxes anywhere at all. They are not residents here, they are not residents there, and their income is earnt globally. So they think they shouldn't have to pay tax to any particular country.
source? Has "the harms that wealth inequality brings" even been quantified?
If you're trying to imply the housing shortage only exists because rich people have too much money and are making prices too high for everyone else, that doesn't make much sense. If everyone had the same amount of wealth, you'd still have the same housing crisis. Specifically, there's still going to be the same amount of houses in London, and the same amount of people who want to live there but can't. The problem of housing in London is that there isn't enough for everyone who wants to live there, not that the rich are making prices unaffordable.
And why might that be? Could it be that the rich are using their wealth and disproportional influence that wealth gives them to slow down or block new development to keep their property values high, or are we supposed to believe that places where housing is used as an investment vehicle are just naturally incompetent at building more housing?
As for the down-voter of my parent post, I would like to say that the question was genuine, out of curiosity. I do not see the reason for the down-vote, really.
If it got to a situation where libraries aren't being funded and water isn't clean, which isn't out of the realm of possibility with this administration, then I may need to reevaluate my stance but right now I'm fine paying what I owe.
By the way, I was just reading this: https://news.ycombinator.com/item?id=44630810.
It's curious that the percentages used to defend not taxing the rich (whether they are UK citizens, or operating as "non-doms") tend to be what percentage of the tax burden they pay. But it's never what percentage of their income and capital gains they pay as tax.
I think the latter is a fairer representation, considering we have a progressive taxation system. Someone who is earning over £125k a year should be paying close to 45% of their income and capital gains.
The question is: are they? If not, why not?
>The question is: are they? If not, why not?
Because they're non-domiciled and for several centuries the UK didn't tax foreign income of non domiciled residents. It's not a mystery, it was the law.
The non-dom's came to the UK because of this tax regime. The UK can either have the revenue they get from them, which is substantial. Or, it can remove the non-dom regime, hope they stay, but be prepared for total loss of their revenue if they leave.
There's no magical third choice where everyone in that non-dom category stays just cause and pays more money. So far it looks like UK tax revenues are set to diminish from this change.
I think we should be taking a page out of French History
Every so often I think the wealthy classes need a reminder that they only get to have what they have at the pleasure of the lower classes
Being able to pay higher prices than locals so prices for goods and housing go up? "investment properties" and such
Which benefits are they enjoying that they are not paying the taxes for? National defense?
https://www.newstatesman.com/politics/2025/07/the-british-we...
You cannot tax these people directly, because they'll leave.
You cannot have international cooperation on tax treaties because these people control states.
In other words: you can only tax them either through war, or by totally blowing up trade relationships.
Putin is estimated to be up to $200 billion in wealth.
The top 4 Americans are all more wealthy: Musk, Zuckerberg, Bezos, Ellison.
You could say that number is artificial. But you could say the same about any stock market valuation. Even that ignores that even 80 Trillion wouldn't buy the power Putin has. It would, for example, not buy 8000 nukes. I'm 100% sure that if Elon Musk threatened to nuke Washington he'd be in prison within the hour, and if his wealth was 1600 times bigger than it is (which would bring him near Putin), that wouldn't change things. Reality is not a superman movie.
The grand duke of Luxembourg is worth about 400 billion USD by the same measure, or a bit more than Elon Musk (although that ignores that the risk to Luxenburg as a country is MUCH less than the risk to Elon Musks' companies)
This is much harder to evade - if you own most of Mayfair, you can't just move your assets elsewhere - they are very clearly tied to the location.
Of course, this would mean taxing powerful aristocrats, including the royal family. With their large majority, the British government had the opportunity to do this, but decided to take an easier path. The reason why this path was easier is now becoming clear to them.
Simple, and more effective!
As an example, Wouldn't that mean that if my startup raises a round of 1m for 10%, my NW would go to 0 to 9m. 6% of that would be around 0.5m, and 30% tax would mean I would have to pay 162,000 EUR in taxes.
As a cash poor founder how do you suggest I pay that.
That's why taxing income and not wealth has been the norm.
Another point: have you considered that the authorities and people of the Netherlands, a very rich country with several valuable companies, may have possibly thought of this absolutely trivial argument when designing their tax code? Do you really think nobody thought of it?
Jesus
---
To your point: stakes in your _own_ company are not taxed as assets, but as income, precisely to avoid the ridiculous situation you point out.
Simply put: your retirement savings, your brokerage account = assets, your startup, your company, your farm = income.
Enlightening, so you mean this policy isn't for the so called "1%"? Only for middle class folks and their stock portfolios? That's not what the GP was proposing.
> Another point: have you considered that the authorities and people of the Netherlands, a very rich country with several valuable companies, may have possibly thought of this absolutely trivial argument when designing their tax code? Do you really think nobody thought of it?
Yes, because I can point to an even richer country, with even more valuable companies where the left proposed same destructive policy only a few months ago and almost came close to winning.
Lastly, you did make me look it up and it seems Netherlands and other European countries really didn't think it through.
https://www.leideninternationalcentre.nl/get-advice/blogs/su...
https://www.linkedin.com/posts/jasoncalacanis_norways-wealth...
That does sound poorly thought thru. Why not just calculate it instead of "assumed returns"? Seems unfair on its face and bound to go wrong.
What do you mean? This is a proportional tax (slightly progressive actually due to the 0% rate on the first bracket). It's for everyone with such assets.
> where the left proposed same destructive policy only a few months ago and almost came close to winning.
If you think either of the major parties in the USA can be in any way described as "left" then this is not a serious conversation.
Hell even Switzerland taxes global assets. You just declare your stocks, property, etc at some instantaneous value and that’s that. Capital gains aren’t taxed.
The system is easy to cheat and until recently it was possible for HNW people to get a bespoke deal when moving there. But the tax rate is low enough and the risk is high enough that it’s more beneficial to just pay.
It's a loophole the mega-rich are using to avoid tax.
The other thing that's happened is that a lot of the mega-rich have lobbied to gradually chip away at inheritance taxes. So again they just pass the asset, paying a fraction of the taxes they'd have paid had they been a "normal" tax payer.
And one of the big things they've got? No capital gains on those stocks when passed to children.
So yeah, we need to tax assets as well as income. Because anything that's not taxed the rich just funnel money into it to avoid paying tax.
> There's been a big shift of rich people avoiding taking pay or dividends. Instead they get paid in stock, and then get interest free loans secured on that stock to actually spend money.
They have a stockholding in a firm, and the firm pays CIT on income earned. That sounds fair.
> The other thing that's happened is that a lot of the mega-rich have lobbied to gradually chip away at inheritance taxes. So again they just pass the asset, paying a fraction of the taxes they'd have paid had they been a "normal" tax payer.
Why should my kids be liable to pay a tax when they inherit my house? That house was bought by my income on which PIT was duty fully paid. Again sounds very fair to me.
> And one of the big things they've got? No capital gains on those stocks when passed to children.
Again sounds fair to me.
If you just think it's the government stealing your stuff, then it seems very unfair to have your stuff taxed after you die.
But what tax is, under another lens, is a way to divert the capacity of a state to social ends. Everything from the military to the police to prisons and the justice system is what enables you to live in peace and accumulate stuff in the first place. Those are social goods.
So how do you fund this spending? How do you incentivize other people to protect your house? Well, the solution of tax is they take a little bit of your stuff over time, in a predictable way, according to rules that are pre-agreed and can be changed with consensus.
Or go to fund programs that only your political opponents benefit from.
Also, anyone living in the bay area can attest how terrible the roads are for how much tax money clearly gets spent on them.
This isn't to say taxing wealth is actually the solution, but it's the catch all that people like to scream about.
30% of pensioners are millionaires in the UK, and they recieve a state pension. Fixing that would probably immediately turn a massive budget surplus ( albeit a nasty suprise for financial planning ).
However, suddenly if you find pensioners releasing funds from their property, you affect what's going to be inherited and that's a no go area. There's no real concept of fairness in the debate, just the politics of it all.
I think “30% of pensioners are millionaires” is also a bit moot given the majority of those are living in properties that they didn’t buy for millions and have lived in while house prices have gone up. My parents for example are probably close to your millionaire threshold and it seems unfair that they’d have to sell their home they’ve lived in for decades and want to continue living in just because the housing market has pushed its value past the point where it seems like it should be taxed. They’d have to sell it just to pay that tax and move somewhere smaller, which seems unfair to force on people approaching 80yo.
Like you're talking about fairness, but you're also arguing that other people should pay taxes to give your parents money, in order for them to keep their property, whilst many of those paying their taxes, will never get on the ladder, and if they do, will never afford such a lovely house.
Where's the fairness in that?
Further, most folks are aware of equity release and your parents could borrow against the house and not move. The main outcome is you wouldn't get it. Now I've bought such a house but I didn't get it from my parents, I got it by earning the money which I've paid income tax on, so it's literally required 2-3x in earnings to get there.
What's fair in that?
For the record, I have a kid in private school and will try my best to pass on as much as possible, so I totally get both your parents and your own position. I'm just poking fun on "fairness" because fairness in politics never seems to consider the person the money comes from and when you consider all angles, it's rarely fair.
I assume a new government dept. has to be set up to oversee it. Or do the wealthy self assess? Are things like shares and investments valued once? Once per year? How is a company valued? How do you know if you qualify as wealthy? Do we value everyone’s wealth? Can’t the wealthy just relocate or move assets out of reach?
I don’t expect answers to this, I’m just thinking out loud as there seem to be a lot of challenges.
A few countries seem to have tried and continued to tax wealth but it seems far from proven and only seems to “work” in Switzerland, which is a bit of an outlier
I think the simpler solution if simply passing along the original cost basis to heirs (and without documentation it’s assumed to be zero). That way people or even families can defer taxes on income, but eventually they get paid.
Britain could just as easily tax profits on the sale of shares in British companies, regardless of the country of domicile of the company or individual that sold the shares.
We don't need wealth taxes, we just need parity between tax on earned and unearned income.
You don’t need new govt. dept. tax authority is enough. You do your yearly tax statement.
In NL they have access to your bank accounts or more like banks and brokers are obliged to provide state of accounts as per 1st of January.
Downside is you pay wealth tax on „possible gains” not actual gains on wealth above 40k€. If you have mortgage it of course is deducted from value of your house or any debts that you have documented.
In case you think collecting watches can make you hide the wealth, there are of course tax authority checks most likely if your wealth suddenly changes.
Presumably they do have a department of people checking this to make sure people aren't lying, but also Switzerland is a relatively high trust society, and taxes are reasonable, so people probably don't mind paying too much.
In the UK in 2025 I'm not sure this would work, people would try and evade it and the UK government isn't competent enough to stop them
There was a bit of a scandal a few years back at just how much input the Queen got to those sort of laws, but it didn't really have legs as everyone thought she was brilliant.
But if the same thing comes out about King Charles you can bet it's going to be a bigger stink.
The UK needs to radically reduce its social safety net and simultaneously cut taxes, at least for new companies and small businesses. The only way out is real, sustained, long term growth and innovation. Stealing ever more of a shrinking pie is already running out of steam.
I was under the impression they had done that already.
https://en.wikipedia.org/wiki/United_Kingdom_government_aust...
Though one can't help but think it wont be radical enough for conservatives until we simply dispose of those unable to work through some dystopic mechanism or other.
> Coalition and Conservative governments in office from 2010 to 2019 used the term, and it was applied again by many observers to describe Conservative Party policies from 2021 to 2024, during the cost of living crisis.
2024, last year, is "a long time ago"?
>The UK needs to radically reduce its social safety net and simultaneously cut taxes
Unfortunately that is not a popular opinion in the UK. They want to tax everything, taxing the rich is popular among voters which is why they are doing it. And again the consequence have long been known or told. They are doing it anyway.
Most of the street in London is empty. UK is either number 1 or number 2 in millionaires fleeing the country after China. Property pricing are falling somewhat not because of more supply but because those asset are being sold as part of those moving abroad.
I live there and this is just wrong.
With the exception of certain pension benefits there isn't much money flowing into these programs to begin with.
The people who don't (currently) need them see them as a waste.
There are loads of people not participating in the economy because they do t have money, just give them money to spend.
The multiplier effect means it pays for itself.
Doesn't apply to the super rich where the money is just hoarded.
Not the solution is fair taxation every trade made in the country, if you make business in a country you need pay taxes there for the transactiona made there.
Otherwise you just extract value out of the country, without giving back.
To me there is no worse thievery than tax evasion, it's literally robing a nation.
This takes a long time to get - you have to sacrifice now to get the future growth
However, the tax burden in Texas is not significantly lower than a state like California.
Then there are the semi-elective things like healthcare, education, home security. These kinda dont work for the whole society. The rich are thus paying for their own out of pocket. But they are also paying for the semi-working system for everyone else.
I think introducing a wealth tax just to balance the books without rethinking who and how accesses public funds, will just end with the rich leaving. Some may say good riddance, but the UK budget is now beyond creaking and heading for collapse.
Oh and when I say "the rich", that probably covers many people here. IIRC earning 90k per year puts you in the top 1%. A 10-15 year experience NHS doctor is in that bracket.
The very top sliver who own the majority of the land and assets and who never need to work a day in their life are who must be looked at; that hereditary wealth needs to begin to find itself flowing into public services more and more.
Perhaps you should check the facts before making statements like that!
So it says there are 57 billionaires in UK with total worth of £182 billion. Non-billionaire wealth is £10.13 trillion, btw, so it's definitively not 50%. UK population is 68.3 million people. So everyone gets their £11,311 and that's it.
UPDATE there are £772.8 billions if you include non-UK citizens, but happen to live here. If you seize their money as well that will give you the total of £11K
This is a lie. In US, most food our rules, legal system, government agencies (that are not direct transfers like doc security & Medicare) exist to protect properties and interest of the rich.
That higher income people are not seeing much of direct transfers does not mean they are not getting more benefits from the government. Even our bloated military and foreign policy is primarily still protecting US business interests globally. It’s not minimum wage peon that benefits from that. It’s owners of large capital
I earn over £90k in the UK. It is very much true, a lot of things are "means tested".
According to the public data for 2023-2024, top 1% is around £180-200k, so you're off by quite a bit. £90k is around 5-6%. This is gross, not net.
In the U.S., the top 1% is around $570-600k according to 2024 census numbers.
In the mind of probably at least 75% electorate, the top 5% are filthy rich who should make up any tax shortfall. But also 90k puts you, I believe, out of reach of all the services I listed above.
I'm all for paying tax, and even more tax if need be, where I get equal access to services. But not when I'm literally excluded for paying more tax.
Interestingly, according to an FT article, high earners in the UK pay comparable amounts of tax as they would on the "high tax" continent. It is the low earners who oay substantially less, bringing down the effective average. But they in turn pay outsized housing rent, so arent better off either.
As much as one can complain about specific inefficiencies or not being able to send young Jasper and Tabitha to private school because of VAT and tapered tax relief, I do think we don't take it far enough.
The reason it not working is that we have stapled our personal wealth and economy to housing. 60 years of financiers pushing for higher lending limits with looser regulation resulted in more people able to "afford" a £1m house. That drags up all the prices.
There's no simple way to reverse it this distortion but it had a knock on effect: the generationally rich, the landed gentry through to farmers have become insanely rich, through no work but HODLling all the land until they got planning permission.
I agree, wealth tax is scary but not addressing how wealth works won't fix things either.
Earn £300k a year, you pay 65% on more than half of it, and obviously 45, 40, and so on of the first half of it)
Get £3 million from the stocks? You pay 20% (above £50k threshold)
People are obsessed with workers paying all their taxes and letting off the wealthy avoiding the most.
No point owning most of Mayfair if you don't feel safe enough to enjoy your lifestyle.
And it's not just funding the police and courts that leads to this - it's making sure there aren't too many desperate people with no hope. ie paying unemployment benefit so people can live while looking for work - is all part of that stable society from which everyone benefits - but particularly the rich as they have more to lose.
Often it's looted ( or comes from exploitation ) from unstable countries where the weak rule of law has allowed the looting ( corruption or whatever ), and then moved to London to ensure nobody can then steal it back directly or via political revolution.
Taxes are the price of civilisation - if you want the good life - you have to help support civilisation - not free load.
It's these that need to be tackled - not just because of tax evasion, but because they are also a large part of the workings of organised crime.
[1]: Non-dom tax take jumped £100mn in 2023-24 despite falling numbers - https://on.ft.com/3Gx1MXU via @FT
The minimum corporate tax of 15% is one place to start:
And why not? We don't need the extra revenue. Why should we raise taxes on local companies when we don't want the money? Just because other countries can't control their spending why do we have to raise our taxes? It's stupid.
Also, smarter policy would be like what Estonia does
- CIT should only be applicable when dividends are paid. So corporations can reinvest that money in the business and not be taxed on it.
- PIT on dividend income should be 0, since that amount has already been taxed(CIT) and the stock holder has paid his due share on that income as a owner of corporation.
Or dividends should be taxed as normal income.
Dealing with capital gains tax is messier but not impossible.
And even if you took let's say 95% of their wealth that wouldn't even pay down half of the US debt.
I think all this stuff ends up doing is being a brain drain to make people leave whatever country they're in for other countries
Great, do that! Go start companies in other countries, and trickle down their wealth to employees in the form of wages and salaries.
If only they thought of doing that in the UK! Instead of the rich buying up properties turning them into buy-to-lets, both pricing out working people of their first home, and then taking their income as rent.
If I bring in $2 billion in cash to a 100 person town in the US, with a median income of $40k: I can hire none, some, or all of them for $40k to $60k; and make the cost of living too expensive by buying up most of the land, to the point that the remaining stock will cost double or triple the cost.
This is the majority of the oligarch class (Russia, China, Middle East, private equity) who’ve streamed into the democratic West and is an absolute net negative.
Then you have billionaires like Musk (politics aside) who aren’t parking their wealth but building new industries; and the cost of living goes up because of the wages and perhaps demand, as more workers stream in (net positive).
Then you have the rest of the billionaires (high finance, Amazon) whose method is wealth extraction through consolidation and off-shore labor (arguably net negative).
When is enough going to be enough? Using the example of this article, the UK. There was a 70% increase in government spending during the last 10 years. Do you think that you are getting 70% better public services?
Where is the government spending all our money? And what kind of propaganda is going on to make the people believe the answer is even more taxes?
"hey guys between income tax, and VAT and other goods taxes we literally take more than 50% of the money that the entire lower and middle class is earning! This should be more than enough by a factor of two at the least to run our shitty bureaucracy and public services"
Nope it's always
"Who can we tax more? How to we steal more money for our shitty novelty projects and ideological madness"
Anyone resource strong enough to leave, that usually is the upper class, will eventually do so. Leaving even more predatory taxation pressure against the lower social strata
https://taxjustice.net/press/millionaire-exodus-did-not-occu...
neonate•6mo ago