Nightmare for Rachel Reeves as 1 in 8 business chiefs set to leave UK over tax burden | Politics | News
Rachel Reeves is set to face a devastating blow ahead of the Budget as new data shows one in eight business chiefs are set to leave the UK due to the tax burden. According to a new survey by Rathbones, 12% of small and medium-sized business leaders (SMEs) – the equivalent of around 680,000 businesses out of 5.67 million in the UK – are actively planning to move themselves, their businesses or both due to the current tax burden.
One-third (33%) of those planning to move said they would also move their business abroad, another third said they planned to move individually, and the rest only planned to move their businesses. 26% of this group rated Ireland as their most preferred destination, ahead of 21% who chose Dubai and 18% who chose the USA.
Rathbones commissioned independent research agency Viewsbank to interview 1,024 SME founders, owners and senior executives last month. Almost two thirds (63%) of SME owners and bosses believe the government is not doing enough to encourage business growth in the UK.
Meanwhile, more than two fifths (42%) say Government policy does not support businesses as many entrepreneurs plan to move outside the UK.
While budget concerns aren’t shutting down all businesses, 26% of company leaders say they’re still concerned about the tax environment even if they don’t plan to move abroad.
The vote comes just weeks before the Chancellor’s Budget, which is rumored to increase Ms Reeves’ workload and raise taxes.
Ade Babatunde, senior director of financial planning at Rathbones, said: “SMEs are the backbone of the UK economy and the fact that many of them are actively planning to leave the country due to the current tax burden, either personally, by moving their business overseas or both, is deeply worrying for the government’s ambition to grow Britain.
“Their departure will mean the loss of valuable tax revenue and much-needed employment opportunities.”
The data also revealed that 36% of respondents believe that Employer National Insurance and National Living Wage increases have had a moderate or significant impact on their business.
SME leaders are calling for tax breaks to encourage business growth and staff recruitment, as well as incentives for business owners to take risks.
Mr Babatunde added: “SME owners are sending a clear message: they feel let down by current government policy. “With nearly two-thirds saying not enough is being done to support job creation and growth, and many citing tax changes and rising employment costs as major challenges, it’s no surprise that confidence is falling.
“What SMEs want is encouragement of risk-taking and recognition of success. These are not just in demand, they are essential components of a thriving economy.”
