Rachel Reeves should launch a tax raid on wealthy people fleeing Britain as part of sweeping changes to capital gains rates, a leading think tank has said.
The Institute for Fiscal Studies (IFS) has called on Ms Reeves to impose an exit tax on investors moving their money out of the country, which it said would reduce incentives for them to flee.
The IFS proposals are odd, most odd. I don’t trust the two who have written them as far as the Vunipola brothers could throw them. I take their writing for the IFS as being a proof of Conquest’s Second Law.
There’s not a hope in hell of the overall proposals being accepted. Even though some of them are economically sensible.
But the effect of that overall set of changes. It would be to tax, and hugely heavily, successful entrepreneurs. And to not really tax anyone else very much. Which, – incentives, you know? – doesn’t really seem like quite the right thing to be doing.
I don’t see how that would work anyway. This is not like the old days of currency controls, when people would take suitcases full of cash to Switzerland.
Is there a limit to the number if Turkish barbers or American Candy stores one can open, I wonder ?
There was a certain regime in the 1930s that did exactly this – you can flee as long as you leave your money behind. What else are they looking at them for inspiration?
@jgh
I was thinking the same. It was the Reichsfluchtsteuer or Reich Flight Tax.
Followed later by the Judenvermögensabgabe which didn’t even bother to wait for people to flee but simply taxed Jews on their assets. 20%, later raised to 25%.
The Nazis were also able to dress it up under guise of distribution, broadest shoulders, inequality and the other guff beloved of the left.
There’s a business opportunity worth looking at. Helping people move their wealth out of the UK without paying tax on it. One needs a token of value doesn’t one? Mmmm…
Andrew C! You need to learn some history! The Nazis were far right thugs! Nazi stood for National Soc…
Oops, sorry…
I find their assumption that HMRC are competent enough to administer such a tax to be rather quaint.
Charlie Mullins, founder of Pimlico Plumbers, has said he is ready to have “no assets in the UK”
What if Labour decides to tax botox and fake hair that looks like a human troll doll?
Charlie’s not thought this through, has he?
We still have a Republikfluchtsteuer, and it applies to unrealised capital gains. If you leave the country while owning more than 1% of a company. I think the rate is still 25%, in line with tax on most capital gains.
I recommend a tax on wearing The Wrong Trousers.
https://www.flickr.com/photos/number10gov/53837066630/in/photostream/
(Just look at his ankles.)
They really do love throwing gasoline on the bonfire, do they?
How much did he get in donations from Lord Ali for clothing?
If I were Lord Ali I’d want my money back and get the tailor struck off or whatever happens to crap tailors.
Of course I wouldn’t have given the money in the first place.
Lord Alli, damned autocorrect and proof reader.
Ah dearieme! So that’s where the missing material from Sunak’s trousers went.
I see Ritchie is throwing a tantrum about the IFS report. If you both disagree with it perhaps the IFS have a point….
Didn’t Rachel Reeves sat something along the lines of ‘people will be happy to pay more tax, they won’t leave’?
Won’t this just push people to incorporate overseas, to avoid the CGT? If I start my company as Cayman Carpenters, then decades later I emigrate to Switzerland, the government won’t be able to control who I sell it to, nor for how much. No doubt there are plenty of pitfalls with this scenario, but accountants and lawyers will make lots of money avoiding them.
Andrew M – Or start British Carpenters as the wholly owned UK subsidiary of Cayman Carpenters, the possibilities are endless……
This seems to have a remarkable resemblance to the dosh Hamas wants to allow those hostages to emigrate from Gaza.
Can anyone who really understands economics explain the difference??
@Andrew M – “Won’t this just push people to incorporate overseas”
If that works, you’ll find that profits made in the UK become subject to some large extra tax at the point that they leave the country, and if they accrue to a foreign company or person, they are taxed again even if they don’t leave the country. Or maybe any foreign entity must have a local person or company who holds their valuables in trust and subject to UK tax. The possibilities are endless.