New research from the Adam Smith Institute reveals that the number of real-terms millionaires in Britain has fallen to its lowest level since the 2008 financial crisis.
The wealthy are not simply leaving because of unfavourable policy, but also because of a broader cultural hostility toward wealth and success that has taken hold across the country.
Replacing the tax contribution of the average departing millionaire requires the equivalent contributions of 49 ordinary taxpayers, placing enormous strain on the public finances.
With public spending at a record high and tax levels higher than at any point since the Second World War, the departure of wealthy residents is being acutely felt across public services.
Perhaps most strikingly, just 19 per cent of Britons consider getting rich a worthwhile endeavour, a figure lower than Japan, Italy, Sweden, Spain, America, and even France.
This cultural shift has moved beyond social attitudes and infiltrated successive governments, leaving a visible mark on the tax system and the way wealth creators are treated.
The abolition of non-domiciled tax status after 200 years has drawn particular criticism, with the OBR’s own data projecting that 25 per cent of affected high-earners will relocate abroad as a result.
According to research from the Adam Smith Institute, the cost to the UK economy in lost growth and consumption from the non-dom policy alone will reach £111bn over the next decade.
British entrepreneurs have fared little better, with increases to the minimum wage and national insurance, reductions in business rate reliefs, and capital gains tax hikes all compounding the pressure on new businesses.
Entrepreneurs’ Relief was removed and replaced with a scheme half as generous, and 2026 follows a year that saw the fewest businesses created since records began in 2017.
The broader European experience offers a cautionary tale, with three-quarters of EU nations that introduced wealth taxes in the 1990s having since rolled them back due to high implementation costs and significant capital flight.
Adam Smith Institute Chairman James Lawson argues that restoring competitive non-dom incentives, reducing capital gains tax, and easing top marginal income tax rates would ensure enterprise is rewarded rather than punished.
Faced with a fresh letter from 120 so-called “patriotic millionaires” calling for higher taxes on wealth, the government has been, as Lawson notes, “conspicuous in their silence.”
London is not Miami or Monte Carlo, and with economic growth having floundered at roughly one per cent over recent years, Britain can no longer afford to treat personal wealth with contempt.
Without a decisive shift toward a pro-wealth, pro-enterprise culture, ministers risk learning a hard economic truth: that in rushing to tax the rich, they will succeed only in making the whole nation poorer.