Saturday, Apr 25, 2009
Missing you already!
The Times: We’re fleeing high-tax Britain, say City tycoons
Hugh Osmond, the pubs to insurance entrepreneur, is considering a move to Switzerland. Peter Hargreaves, the £10m-a-year co-founder of Hargreaves Lansdown, the financial adviser, is looking to move to the Isle of Man or Monaco. They are likely to be followed by others.
Osmond said: “A lot of people will be off. I think it’s highly unlikely that I will continue to have the UK as my country of residence. It’s just as easy to work from any close location — Switzerland or wherever.”
Hargreaves said: “I won’t pay, I’ll leave.”
Posted by devo @ 10:30 PM (1851 views) Add Comment
36 Comments
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1. montesquieu said...
Let them go. We are always better off without these leeches who have such a high opinion of themselves, and they all come crawling back in the end anyway.
2. This comment has been removed as it was found to be in breach of our Blog Policies.
3. devo said...
In the event of a global economic crash, there are few places I'd rather be.
4. Maihem said...
montesquieu, we're not without them. They are still doing their work and getting paid, and still doing the work for us and getting paid by us. However, this will drop the price of their work. so that's good.
5. Mr Gerbil said...
Good for them. If enough others do the same, then even Snotgobbler and Badgerface will have to admit they were wrong.
6. crunchy said...
2. devo
I have just come recently returned from Mallorca or is it Majorca. No camera's, parking problems, fines, low crime rate, and sun sea and sand.
Britian is not what it used to be and if things got bad I know where I would head off to.
7. crunchy said...
Typo- "I have recently returned from Mallorca"
8. Grumpy Middle-aged Git said...
@3 crunchy,
as much as I love Mallorca, last time I visited about 4 yrs ago (and several times during the 90's), I feel that the north of the island which used to feel genuinely "Mallorquin", has been utterly sanitised and overpriced due to British and primarilily German investors. The prices are insane, not just for real estate but also for staple goods, compared to what you can buy in mainland Spain. The likes of Richard Branson investing in luxury resorts in the West near Deya?/Valldemosa? have not helped and prices in and around Pollensa are lunatic.
Sure, there are many, many attractions compared to the UK and barely a day goes past when I don't dream of relocating there but I fear that all the same problems that we currently face in the UK are present there, combined with a considerably worse job market in terms of wages and security. (My brother worked there for 4 years with a Mallorcan company in the early 90's).
I'm afraid that this is an island paradise that has been utterly bu**ered by highly leveraged British and German speculators and the fallout will, I fear, be far worse than on the mainland. I hope one day that that it will return to being a realizable dream.....
9. Britishblue said...
Franky, this is being well over hyped by the media. It is very easy for the entrepreneurs who have the companies books under their control to set up companies in places like Greece and the Seychelles, be creative in the invoicing and move money there.
These are the people that can, if they wish move and are probably well adverse at dodging tax already.
However, high earning civil servants, high earners in private utilities, High earners in other top paid jobs, simply can't up sticks and move. What wasn't reported was that before the recent rises, Britain was one of the lowest high earning tax paying countries. Given that we have the highest debt figures ever of course greater taxation is needed. It will be the rich and the fags and booze brigade first, followed by the middle classes in the next couple of years.
10. Bear said...
Mr Osmand bought us Wetherspoons. He is one of the main reasons pints aren't £4 in London.
Just looking at the housing market. Most entrepreneur/builders who build in excess of 10 houses earn over £150k. Most shop chain owners who have over 10 shops earn, over 150k.
Most people who contribute to the economy above their weight earn over 150k.
But the 150k tax is just posturing. Cameron will reverse it, and it doesn't come into play until the election. Its pure theater, but dangerous theater that will loose the UK jobs.
Sure, regulate fraudulent derivatives and leverage, but we need lower, not higher taxes. If you let the higher rates pay more, you will be next. They may be just testing public appetite for higher taxes. They are broke.
11. Bear said...
Mr Osmand earned is 150k, the government didn't.
We either learn from the failures of Marx or we have to learn another lesson, before we wake the hell up to the rediculous mess caused by class warfare. Don't you people realize that small time entrepreneurs aren't the problem, they are the solution? It is establishment financiers, in cahoots with big government that have led us here.
12. Notaguru said...
Crunchy @3
there's a better quality of life, no question, but there's also a 20%+ unemployment rate in the Spanish Costas and Islands (all over spanish press yesterday).
There's a large pool of well qualified, young spanish workers looking for work at present. If you combine that with an economy largely based on low paid service jobs and it doesn't make for very good job prospects. Salaries are very depressed indeed.
In summary, great for a holiday or if you don't have to work, but if you have to get and job and make a living.....
13. debtfree said...
@crunchy
"I have just come recently returned from Mallorca or is it Majorca"
Ha ha. Love it.
Looks like the sun has got to your head :o)
14. richc said...
The residency basis for UK taxation is absurd. I'm an American, and as such, I owe taxes to the US government no matter where I live or earn income. That system works perfectly fine for the US and would do so in the UK as well. These people are only able to claim that they no longer live in the UK and thus escape paying taxes because the Labour gov't allows them to do so.
15. The Number Cruncher said...
Good riddance
back taxes should be paid if they want to return of course
Citizenship = taxes
When will the hard working people of the world stop believe the lies of the rich
16. jackas said...
Bye bye bye bye bye bye bye bye.
Go and force asset prices up somewhere else. Anyone who claims their prosperity relies upon hanging on the coat-tails of these people can shut up and go with them.
Quality of life for the rest of us can only go up, unless you're an idiot geared up to the eyeballs.
17. crunchy said...
Thanks to all above.
The job thing is not a problem. yes it is the north I was referring to, Cala Millor/Porto Cristo.
These places remind me of what Britian used to be like in the sixties before totalitarianism kicked in.
Tranquilo!
18. _woody said...
Just a pity such high flyers did not leave sooner. We may have avoided the trashing of much of our financial infrastructure.
And if these people are quick to leave now, a fairer, more even income distribution might actually well serve the wider economy.
19. Tax Pays For Good Things said...
So you spend all Friday trawling every contact in the City to get them to say they or their clients are leaving the country. And you come up with, er, someone called Peter Hargreaves, who is a financial adviser. Well, to be honest, I don't think that will be a great loss to the country!!!!!
20. crunchy said...
16. jackas
Almost right. Yes I too have to make a living and I made my mind up a while ago that if you can't beat them then join them.
With regards to driving up asset prices give me a break. I have never paid over the odds for anything, on the contary.
If I were to move to there it would be on a rental basis untill things returned to sanity. Again Tranquilo!
21. uncle tom said...
Whatever one's feelings about high earners, the bottom line is that it has never been easier to domicile yourself somewhere else on the planet where tax rates are lower - and pay your tax there.
Moreover, idyllic but penniless countries will welcome these people with open arms.
This measure will almost certainly prove to be a massive own goal, with tax receipts falling as a consequence.
This was nothing more than a political stunt; without a care for the economy.
The country can't afford to play games like this at the moment..
22. crunchy said...
19. uncle tom said..."The country can't afford to play games like this at the moment."
Twelve words sum the artical up.
Another Brown skid mark!
23. tyrellcorporation said...
I read this morning that only one third of the high earners targeted by this tax will actually end up paying more. If you are wealthy you simply get your accountants and lawyers to work around the problem. Just red meat for the embittered left and it won't help the economy one jot.
24. nubbers said...
Uncle Tom, you nailed it there. It is just a political stunt for next year's election.
In the event that my business survives this recession and somehow I find myself not pennyless and destitute, but in a position where the new taxes might affect me, there are still mechanisms left to avoid the 50% anyway. If the Moron starts taxing companies such that my company can't grow, that is when I will pack my bags and relocate elsewhere. I really miss my native Ontario and regardless of the local tax, the govenment here is providing more and more incentive to go back.
25. will said...
Bye-bye.
26. icarus said...
If Brown is serious about international co-operation he should get his counterparts to look into the elaborate financial engineering that enables transnationals to transfer their buying and selling between affiliates and subsidiaries so that profits are moved beyond the reach of taxing governments.
According to the OECD about 60% of world trade is internal transfers within transnational companies, which choose where to incur costs, where to allocate overheads or locate assets, where to borrow money, where to define transactions for duty and tariff purposes and where to make taxable profits. They parcel up parts of their business - shipping, insurance, intellectual property, marketing etc. - and own them offshore. Obviously they weight costs towards states with high tax rates and profits towards those with low tax rates. It's can be difficult to determine an open market price for transactions because trade is often concentrated between a few associated companies.
A product can take a circuitous paper trail through tax havens with the companiy's subsidiaries charging royalties for the use of finance and marketing, insurance, distribution and the use of brands. When it reaches its destination its cost can be very little less than its selling price. There are some enormous privately owned transnationals which do not have to file detailed accounts, and tracking their shenanigans is particularly difficult.
Consequently corporation tax as a proportion of profits has been falling globally - another way in which globalisation becomes exploitation, since the tax burden is shifted away from companies and onto workers and consumers.
27. robh said...
what proportion of the 150k earners are the ones who invented the 'financial instruments' that made the economy crash in the first place?
payback time?
28. Ted The Red said...
What the wealthy don't seem to realise is that a lot of the wealth they have accumulated over the past few years was due to operating in an economy fueled by a debt bubble whose collapse is now crucifying us. ie they were fortunate as well as skilful/clever. Under these circumstances some of us do feel that they can and should pay back relatively more.
29. braindeed said...
The argument that 'It's an own goal, you can't do that....we're too important ......etc' does seem a tad familiar doesn't it?
This site has become nothing more than a talking shop for self-interested 'keep your hand off of my stash' t*^ts.
With concerted, multilateral accountancy rules in place, there should be no place for money to hide - it'll take will and organisation, but it could be done.
I'm hoping a certain self styled 'mongrel' can carry enough governments with him in the pursuit of fancy 'tax avoiding’ schemes, for or this to become a reality. And as for tax haven idylls? - go live in Ghana or some other third world 'non-participatory ' country with your stash.......Please, you parasites!!!
30. Frank Bell said...
Post 14, Richc
Yeah, I feel sorry for Americans being taxed on a Nationality basis. You cannot escape it unless you renounce your nationality so I suppose you just have to stick with being taxed on W
31. crunchy said...
26. braindeed
Have you ever heard of the saying... The harder I work the luckier I become. People with some money are not all parasites!
32. Frank Bell said...
Post 14 Richc
Yeah, I feel sorry for Americans being taxed on a Nationality basis. You can only escape this by renouncing your nationality which leaves you in a not so good position if you lose your passport. The IRS can even tax other countries citizens (as resident aliens) who visit the USA for over 4 months every year under the substantial presence test.
This affects anyone with retirement homes in Florida etc and the IRS can tax the worldwide savings income etc of those people. I wonder how much America will lose by doing that, in the end people will wise up and spend their retirement income elsewhere, Also I reckon Florida State will lose a lot more money from property taxes of those who leave.
As Uncle Tom said, there are plenty of countries with lower tax rates who would welcome retirees to spend there.
It's a shame because the US is a nice diverse country and there are some friendly folk over there. Maybe in years to come the US will want to give retirement visas in order to bring more money in to the country as their debt clock figure gets bigger and bigger......
33. Lenny said...
Braindeed, 26.
But what if you had filled up your piggybank? Would you be off to a Tax Haven yourself or would you really be happy paying 50% tax plus 11% NI on your income?
34. braindeed said...
I have no dispute with anyone earning a good living or being wealthy.
Read the piece again.
And as for the homily……very original, almost as tasty as moms apple pie.
35. crunchy said...
Indeed braindeed!
36. letthemfall said...
"Dozens of Britain’s best-known business figures have condemned the new tax grab"
This pretty much sums it up. They may as well have said: The rich have condemned high taxes.
As ever, the well paid fall over themselves to make excuses for why they should continue to be highly paid but taxed the same as someone earning a quarter of their income. It's their fantasy that they are the sole wealth creators; employees are as much wealth creators as the entrepreneurs. As initiators of business, they are entitled to a return, but not a favourable tax system at the expense of the low paid. If it is true that the country will lose out on tax revenues, let the govt close the loopholes. However, I doubt the treasury will lose out that much, just as the tax revenue did not increase during the 80s high rate tax reduction, as some of the ideologues of the time suggested it would. And anyway, where is the all the wealth they created?