Reeves has instigated a wealth and talent exodus: welcome to REXIT
This year has seen the biggest single wealth exodus ever recorded, and they are taking an estimated $91.8bn USD out of the country with them, writes Jamila Robertson
Rachel Reeves’ now historic Budget carried on where her last left off – bruising business, threatening jobs and further squeezing working people.
It raised taxes by £26bn; saw a ‘mansion tax’ levied on all properties over £2m; the income tax threshold extended for a further three years; caps on ISAs and pension contributions through salary sacrifice; and 2p tax rises on dividends, property and savings. All of this to fund the removal of the two-child benefit cap, which a year ago was ‘unaffordable’ and a sackable offence, but is now deemed necessary to save the jobs of the PM and Chancellor.
For a pair who claimed to value working people above all else, it was an assault on anyone who gets up in the morning, goes to work and tries to do the right thing.
In its aftermath, we’ve seen business rates triple, the welfare bill balloon and the OBR cast doubt on the legitimacy of the Chancellor’s gloomy pitch-rolling.
Is she having a Laffer?
In her riposte, the Leader of the Opposition, Kemi Badenoch, mentioned Lakshmi Mittal, the billionaire Labour donor and Britain’s seventh wealthiest man, who abandoned Britain for Dubai ahead of the Chancellor’s baleful Budget. He’s not the first nor will he be the last to do so. I have written previously of the talented entrepreneurs and wealth creators seeking refuge outside of the UK – Revolut’s Nik Storonsky, Goldman Sachs’ Richard Gnodde and Pimlico Plumbers’ Charlie Mullins – all opting for tax-friendlier climes – not because they don’t want to pay their fair share, but because, as Arthur Laffer noted as far back as 1974, there is a point beyond which taxation actually reduces revenue.
The Chancellor has much to learn. Perhaps we should have taken note when she replaced Nigel Lawson’s portrait in No.11 with one of Ellen Wilkinson, a founding member of the Communist Party.
In her Budget, Reeves could have attempted to improve the tax system: reducing corporation tax, broadening the base of VAT, or, as the Conservatives are proposing, abolishing stamp duty for primary residences and business rates for hospitality. Nigel Lawson sagely advocated for ‘lower rates and fewer breaks’ – a simplification of the tax system that would deter evasion and ensure people keep more of their money.
In every Budget, Lawson sought to remove a tax; Reeves seems determined to do the opposite.
Following the Chancellor’s first Budget, job vacancies have fallen by 115,000, and the unemployment rate has soared to five per cent. The result? The ONS estimates that long-term emigration for the year ending June 2025 is 693,000. According to Henley & Partners, 2025 is the largest single-year wealth exodus from the UK ever recorded – and they are taking an estimated $91.8bn USD out of the country with them. The UAE, USA, Italy, Switzerland and Saudi Arabia are in the top five, respectively benefiting from our WEXIT, or as I prefer, REXIT (Reeves’ exit).
Those who scoff at these figures glibly assert that they’re happy to see the backs of millionaires who don’t want to pay more tax, but it isn’t just millionaires leaving.
Two-thirds of those leaving the UK are under the age of 35. The emigration of British nationals in the year to June 2025 was 252,000, with a net figure of 111,000 for those aged 16-34.
Whilst Reeves and this Labour government haven’t quite figured out what a working person is, for anyone with a job, or business, it’s clear that they will bear the brunt of this record-breaking tax-rising Chancellor (£64bn in 17 months).
The income tax threshold freeze means that by 2031, one in four taxpayers will be paying the higher tax rate; a further 920,000 dragged into the band as a result of the three-year extension.
And for young workers delighted at an increase of 85p in the national minimum wage, the Centre for Policy Studies estimates that increases to the National Living Wage, National Minimum Wage and Apprenticeship wages from April 2026 will cost a business an extra £3,414 to hire a full-time, minimum-wage worker over 21 – a 15 per cent increase since 2024. For someone aged 18-20 working full-time on the minimum wage, the employment cost will increase by £4,095 – a two-year increase of 26 per cent.
The CPS rightly highlights that this is not moral benevolence by the government, as those over 21 will retain just half of the increase, with the rest taken in taxes.
The great emigration is a talent exodus – and not just of established entrepreneurs, but fledgling founders, CEOs, teachers and experts. Graduates who’ve spent the last year trying to get a job in everything from consulting to Caffe Nero have given up – and as a famous entrepreneur who made this country home expressed to me, it’s not only about those leaving, but those who wouldn’t be crazy enough to come!
Our tax-raising chancellor is responsible for this REXIT, without a clue how to create growth. Margaret Thatcher is often quoted as saying the problem with socialists is that they eventually run out of other people’s money. In the case of Rachel Reeves, she’s likely to run out of people first.
Jamila Robertson is director of the Centre for the Future of Work