Labour’s tax rises have led to an exodus of wealthy Britons, the business secretary has admitted.
Peter Kyle said he accepted that “some of the decisions” the party had made since taking office had caused “some people [to] feel the need to leave”.
Asked if the wealthy were opting to leave because of tax decisions made by the government, he said: “Yes, I do.” He added: “I’m not going to duck the fact that we have put up taxes and we’ve closed some of the loopholes for non-doms.”
It emerged over the weekend that Lakshmi Mittal, the Indian steel mogul who has dominated the Sunday Times Rich List over the past 30 years, is the latest billionaire to leave the UK in response to Labour’s shake-up of how the super-rich are taxed.
Lakshmi Mittal previously donated millions to the Labour party but has left Britain after the non-dom status was axed
LUDOVIC MARIN/AFP VIA GETTY IMAGES
• Non-dom crackdown ‘could leave £4bn hole in public finances’
At its peak in 2008 Mittal’s personal fortune was estimated at £27.7 billion, the biggest sum ever attributed to a single person on the Rich List when adjusted for inflation. He is a co-owner of Queens Park Rangers and previously donated £5 million to Labour.
Asked by Sky News about Mittal, Kyle said he was worried “whenever somebody feels they have to leave the UK in order to succeed”.
He said: “I think it’s a worry [but] what I don’t want to do is, as a country, just focus just on the billionaires, because there are other people that have needed to leave. There are people starting businesses that have gone to America — actually in their droves — because they haven’t had the funding that they need in this country to succeed.
• Wealthy flee UK in record numbers after non-dom tax overhaul
“And that is something that we are fundamentally stopping the need for by recapitalising the markets here and putting a lot of work in for those start-ups, those scale-up companies.”
Last week, official data revealed more than three times the number of Britons left the country last year than previously recorded. There were 257,000 British nationals who left the country in the year ending December 2024, compared with the previous estimate of just 77,000.
The Office for National Statistics revised the figures after a change in methodology. The numbers were previously based on the International Passenger Survey but now use more robust data from the Department for Work and Pensions, which incorporates everyone with a national insurance number.
• UK net migration lower than thought as hundreds of thousands emigrate
News of Mittal’s departure came days before Rachel Reeves delivers her second budget. The chancellor is expected to launch a fresh raid on the wealthy, including a new mansion tax on properties worth more than £2 million.
Revees’s first budget last October enraged many of the super-rich with increases to capital gains tax and a reduction of the tax relief entrepreneurs receive when they sell their ventures. There were also new taxes on the way family companies are passed down to future generations.
Kyle defended the government’s measures. “We’ve set up a global talent task force,” he said. “We have set up a global talent visa. We are making it easier for people to come here who have high talents.
“Now, some people are going to leave because they were here, because of the way that the old non-dom system worked. There are other people who are coming to this country because of the excitement that’s in our economy at the moment, including the fact we are investing in AI.
“So lots of people are coming here because of the new excitement in our country, but I accept because of some of the decisions we’ve made, like closing those non-dom tax loopholes, some people feel the need to leave.”