Ferrari cut UK supply after Labour’s tax raid on wealthy
The boss of Ferrari has blamed the Labour government’s crackdown on wealth for its decision to cut the number of cars it sells in the UK, saying that a “stabilisation” in demand was happening in the country.
Chief executive Benedetto Vigna told the Financial Times that his firm had reduced allocations of its supercars to Britain because “some people are getting out of [the country] for tax reasons”.
“What I can tell you is that we see a stabilisation over there,” he said, adding that “a lot of people” had left the country.
Non-dom tax reforms
At its maiden Budget last October, the government unveiled a host of measures to clamp down on what it perceived to be unfair elements of the tax system, including the lower rate of ‘carried interest’ paid by private equity executives, private school fees VAT exemption and the non-dom regime.
Ministers ploughed ahead with a manifesto pledge to scrap the non-dom regime, a 200-year-old tax status that allowed wealthy foreigners only to pay UK tax on income and gains from assets made in Britain.
In her Budget speech, the Chancellor argued that “people who make the UK their home should pay their taxes here”.
But it sparked a flurry of high-profile departures from Britain, including ex-Goldman Sachs International chief executive Richard Gnodde, Aston Villa co-owner Nassef Sawiris and the steel magnate Lakshmi Mittal.
Vigna’s remarks are just the latest in a string of knock-on effects. Estate agents have warned that prices at the higher end of London’s property market have collapsed by as much as 20 per cent in the last year, as distressed sellers struggle to find a buyer for their super-prime homes. Butlers and members’ clubs have also warned that demand for their services has plummeted since last Autumn.
Ferrari’s sales shift
The Ferrari boss added that the more punitive tax landscape was not the only cause of his decision to reallocate cars away from the UK.
“Maybe when you sell to the UK, that car cannot be sold somewhere else [because of its right-hand drive]. There are many different factors.”
The comments come a week after the supercar maker upped its annual guidance, in an update to market in which it also set an ambitious revenue target of €9bn.