Super-rich ‘already fleeing Britain ahead of Starmer’s crackdown’

The super-rich fear Sir Keir Starmer will introduce a series of wealth tax rises if he becomes prime minister - Claudia Greco/Reuters

The super-rich are already fleeing Britain amid fears Sir Keir Starmer will introduce a series of wealth tax rises if he becomes prime minister this week, a leading City lawyer has warned.

Ayesha Vardag, whose firm represents the wealthy in high-profile divorce battles, said she has already seen a “flood” of clients quit the UK in anticipation of Labour’s expected election victory on Thursday.

She said clients are relocating to low-tax destinations such as Dubai and Monaco to escape the prospect of Labour increasing capital gains tax and reforming inheritance tax.

Ms Vardag said: “People are flooding out of the UK. The axis of the world is shifting away from England. And it’s been destroyed with this idea that you get votes by bashing the rich.”

Labour has vowed not to raise levies on “working people” as part of its manifesto, although concerns have been raised after the party refused to rule out increasing the levy on profits made on sales of companies, second homes and shares.

There is also speculation that Labour could reform inheritance tax, including measures to make it tougher to gift money and assets tax-free.

The possibility of such policies has already sparked fear among the super-rich, said Ms Vardag, who launched her eponymous law firm in 2005.

She said: “What’s going to happen in a global world where you can live anywhere? People are going to grow their businesses and then move to Dubai or Monaco, selling their businesses where there is no capital gains tax.

“England is not so great that you want to give away half of your business when you can just move to another beautiful country. It’s extraordinarily naive to think that everyone will stay.”

The threat of fresh wealth taxes under Labour comes alongside a renewed clampdown on the non-dom regime, which has allowed wealthy people to live in the UK without paying tax on overseas income.

Chancellor Jeremy Hunt announced the abolition of the scheme in his spring Budget, although Labour has vowed to go further by tightening loopholes.

Ms Vardag said this is another factor behind wealthy people leaving. She said: “England has to compete with the rest of the world for inward investment from rich individuals. And what’s ironic is that England had it and is now throwing it away.

“They are forgetting that people have a choice. England had the magical thing of being a top cosmopolitan city with a great education system and a fantastic tax regime.

“Throwing that away is the most massive own goal in terms of losing inward investment.”

Labour was contacted for comment.

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