The UK is now shedding more millionaires annually than almost any other country on earth. Only Russia is losing more, and for quite different reasons, writes Harmeet Ahuja
The debate around non-domiciled individuals and high net worth residents in the UK has long been framed as a question of fairness. Over the last few years, it was all about how unfair the taxation was in favour of the foreign elite; but now we lament their departure. However, that framing is understandable — but increasingly, it is also incomplete. While there are legitimate concerns about inequality and the design of our tax system, there is a growing risk that political rhetoric and reactive policymaking are undermining the country’s broader economic interests.
Today the Reform party announced a new policy to charge £250,000 a year and to pay the contribution made to those on the lowest income direct to their bank accounts. The Labour party swiftly criticised the proposal. This is interesting as they are currently seeking to water down their own policy of ending the non-dom rules, a policy which has seen an exodus of wealth from the UK, leading to not only a reduction in taxable income but also the “side-effects” of expenditure made by such people in the UK.
Recently The Times reported that the average non-domiciled individual contributes approximately £800,000 in tax per year to the UK exchequer. These are not marginal figures. They represent a significant stream of public revenue — revenue that helps fund hospitals, schools, transport infrastructure and, crucially, the kinds of long-term investment the UK desperately needs.
Yet in the past decade, the UK has seen a steady erosion of its attractiveness to globally mobile wealth. Successive governments, often under pressure to demonstrate political toughness on inequality, have narrowed the non-dom regime and added layers of complexity and uncertainty. The result: the UK is now shedding more millionaires annually than almost any other country on earth. Only Russia is losing more, and for quite different reasons.
This should concern us. The departure of high-net-worth individuals — and, increasingly, their businesses, capital, and consumption — has consequences. Countries such as Portugal, Italy, and the UAE are actively courting the same demographic that Britain is, in many cases, discouraging. They understand a core economic principle: wealth, when attracted and taxed sensibly, can generate disproportionate benefit for the wider population. But they are even more generous than the UK or at best, about the same.
To be clear, this is not a call for the restoration of overly generous or opaque tax privileges. There are valid criticisms of aspects of the historic non-dom system, but this does mean we should end it completely with the result to drive wealth away. Rather, it is to modernise and rationalise the framework, providing clarity, competitiveness and, in my view most importantly, a visible link between contribution and social return.
A practical reform could involve explicitly earmarking a portion of the revenues from non-doms and high earners for targeted national investment — for instance, the development of new towns, affordable housing, or transport and energy infrastructure in the UK’s most underserved regions. This would allow government to directly link the presence of globally wealthy individuals with efforts to “level up” the rest of the country, reducing inequality through meaningful, productive investment — not by turning away economic opportunity and entrepreneurial gain for the UK.
There is also a broader reputational risk at play. When the UK appears hostile to enterprise, success, and global talent, it diminishes its standing as a place to build companies, invest capital and settle long term. The UK should want to be a home not just for capital, but for innovation, entrepreneurship, and global leadership — qualities that often accompany individuals with significant wealth.
Of course, there are legitimate concerns about the distorting effects of wealth in local markets — particularly in central London, where the presence of international money has pushed up property prices and, in cases, hollowed out communities. These issues must be managed, not ignored. But they are not an argument for broad policy retreat. Rather, they underline the need for smart, localised planning, balanced by nationwide strategy.
At a time when the UK faces serious fiscal and investment challenges — from housing to healthcare to regional inequality — we cannot afford to treat globally mobile wealth as a threat by default. We must approach it with confidence, recognising that the right tax environment can both attract contribution and fund collective ambition.
It is tempting in political debate to simplify complex trade-offs. But the reality is that prosperity and fairness are not mutually exclusive. We can, and should, design a tax system that encourages high earners and global residents to base themselves in the UK, while ensuring that their presence benefits the entire country. By making at least part of their tax revenue linked directly to levelling up in the UK will surely improve the perception of them by the majority of people and the contribution they make to the economy.
The choice is not between fairness and competitiveness. The real choice is whether the UK remains an open, forward-looking nation that rewards contribution and channels it toward shared national goals or whether it risks becoming a place where the politics of resentment eclipse the economics of growth. At its simplest, it’s about staying relevant in the world.
