Wealthy Brits might be unlikely to vote for the Labour Party and its leader Jeremy Corbyn in any forthcoming general election in the UK. But many are plotting against his policies should he get in. Oliver Williams looks at an issue that is bigger than Brexit in the minds of millionaires.
Only last year at the Labour Party conference, Jeremy Corbyn said, “The very richest in our society have had tax breaks, giveaways, and tax havens. I tell you what, they’re on borrowed time.”
Hearing Corbyn’s warning, many wealthy in the UK are now fearful. Recent poll of millionaires found 42% of respondents said a change of government was their biggest financial concern.
A change of government is now such a concern among wealthy individuals that it has eclipsed Brexit
Ryan Tholet, head of Investec UK Private Bank said, “We are finding around our client base much less of an issue around Brexit and much more of an issue around planning for potentially a Labour government.
“It becomes [an issue] around tax, domicile and a lot of the ways in which HNWIs [high net worth individuals] structure their affairs.”
Here are just some of the ways millionaires are ‘structuring their affairs’ according to people PBI interviewed on the matter.
1. Change Domicile
Changing domicile might be a more extreme response to a change of government. But it is now a straightforward one given the number of investor visas currently available around the world.
2. Consider Currency
If the Stirling reaches parity with the Euro taking currency out of the country will be much more expensive.
3. Plan your portfolio
Plans to nationalise railways and other projects require big borrowing, which would in turn increase bond-yields.
Inheritance is something that has come under repeated fire by the Labour Party, and one that is likely to be taxed more. Some are wealthy looking to retire early.
With much of the London market being propped up by foreign wealth – which could easily leave in the event of a harsh wealth tax – many are forecasting further gloom in the event of a Labour victory.
This is causing some prospective buyers to sit out the current lapse by renting, rather than buying property in the capital.