Market News

BY Mauricio Alencar

Keir Starmer’s government is reportedly looking to introduce a special visa for foreign investors in an attempt to reverse the tide of millionaires leaving the UK.

Officials are at the early stages of drawing up a visa which would provide an olive branch to wealthy businessmen keen to fund in areas such as artificial intelligence and clean energy, according to a report in Bloomberg. 

The new visa would come as part of a string of immigration reforms aimed at boosting integration and turning the UK into a high-skill, high-wage economy. 

In its white paper unveiled on Monday, the government said overseas businesses would be able to send twice as many workers to the UK as previously. 

Under current rules, a company can send up to five senior employees to work in the UK for three years as part of the Expansion Worker route.

The Labour government also revealed plans to increase the number of people arriving on “very high talent routes” via specialised visas for entrepreneurs and research interns working in artificial intelligence, which could drive up the number of millionaires in the UK.

The white paper said it wished to allow UK firms to compete to attract a “highly prized cohort” of business leaders amid “fierce” competition across the global economy.

This came despite reforms aimed at radically cutting net migration levels from a peak of 900,000 in the year to June 2023. 

Several government departments involved in boosting the economy and curbing immigration agreed attracting talent and influential businessmen was key to UK growth, according to Bloomberg reports.

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But the government’s tax regime has come under fire for repelling investors, with a report by the Centre for Economics and Business Research (CEBR) suggesting that the removal of tax exemptions for non-domiciled residents could cost the UK government up to £12.2bn in fewer tax receipts due to the departure of wealthy individuals. 

Chancellor Reeves has defended policies targeted at non-doms, claiming that the scheme was unfair and has been replaced with a more “internationally competitive residence-based system” for millionaires. 

Millionaires leaving

City AM revealed last month one of the most high profile business leaders living in London – Goldman Sachs banker Richard Gnodde – was leaving Britain, following the likes of Egyptian billionaire Nassef Sawiris out the exit.

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Milan has emerged as an alternative to London as investors pay a flat tax rate to avoid duties on other earnings while Cyprus President Nikos Christodoulides is set to make a visit to London to trumpet up the country’s softer tax regime on the wealthy. 

Research by the Adam Smith Institute said last month that the UK is expected to lose the greatest proportion of millionaires of any country by 2028. 

It also said that scrapping the non-doms scheme could cost the UK economy more than £100bn in the next ten years. 

Writing for City AM, Labour voter and British billionaire John Caudwelsaid reforms to tax regimes represented bad policymaking. 

“I’ve long called for a better tax system that encourages investment and rewards those who stay and build here. That’s not about giving the wealthy a break, it’s about giving Britain a boost,” Caudwell wrote. 

“The current reforms to the non-dom regime may be politically popular, but they risk sending the wrong signal. We must be a country that welcomes wealth creators and holds them to high standards rather than driving them away.”