It's «boring to death» and there is «cultural sterility»
Britain's super-rich are «bored to death» in tax havens, a survey has found. Britain's super-rich would «never leave the country for tax reasons» because they fear they will become stuck in «culturally sterile» tax havens, according to new research from London School of Economics experts.
Researchers from the London School of Economics (LSE) surveyed 35 members of the top 1% of people in the UK — by wealth or income — and found that none said they would leave the UK for tax reasons, writes The Guardian.
“I wouldn't go to a tax haven. Can you imagine anything worse than going to a tax haven? — one of the respondents, Leanne, who works for a consulting company, told the researchers. — Some tiny place where only people with yachts and servants live. So no, I wouldn't leave for that reason… I want to live in a dynamic economic climate where there's room for innovation and, you know, people innovate, and I think London is the same.”
Different respondent Luke, who works as a lawyer, said: “I have a wonderful life here in London. My clients who moved to the Bahamas were bored to death. Sun, sea and sand. Okay, charging your batteries for a couple of weeks is great, but after a while you think, “Well, I’d love to go to the opera.” Well, you can forget about it — there is no theater in the Bahamas.”
Bea and Peter, a couple who both work in finance, said that if they “move to the Middle East, you end up in gated communities and things like that. I never found it attractive anyway.”
Marianne, who works in the cultural sector, said the suggestion that there would be a “big brain drain” if the British government introduced higher taxes on the rich was “complete nonsense”. And I'll give you the answer “why” in a nutshell. and it's the National Gallery or the National Theater… that's why people aren't going to leave London.»
Research by the London School of Economics' International Institute on Inequalities found that the super-rich fear the social «stigma associated with tax migration.”
“Surveys spoke disparagingly of those who chose to move for tax purposes,” the research article said. “Some viewed tax migrants on moral grounds as overly economically self-interested, while others expressed snobbery about tax-advantaged destinations as boring and culturally sterile.”
The research comes as public and political debate focuses on taxes ahead of the general election expected later this year. Chancellor Jeremy Hunt last week indicated there could be significant tax cuts in his March budget, seen as one of the last opportunities for the Conservatives to return Labor to the lead in the polls. “I fundamentally believe that a low-tax economy is more dynamic, more competitive,” he said.
Hunt has come under pressure to cut taxes amid forecasts from the Office for Budget Responsibility that they are approaching their highest levels since the 1940s. Meanwhile, unions, the Green Party and some members of the ultra-wealthy have called for wealth taxes to help pay for battered public services.
A “modest” 1.7% wealth tax on the top 140,000 Britain's people could raise more than £10 billion to pay for public services, the Trades Union Congress (TUC) suggested last year, but Labor and the Lib Dems have ruled out introducing such a tax.
While none of the ultra-wealthy people interviewed for the article, titled «Tax Flight? Britain's Richest and Their Loyalties to Place,» said they were planning to give up paying taxes, many said they were concerned about the UK's top tax rates are currently too high and will rise further.
“A minority of those surveyed said they would not rule out tax migration, but only if political and economic conditions in the UK changed dramatically,” it says document. “A return to the highest tax rates seen in the 1970s, or a Jeremy Corbyn-style government, were often mentioned as conditions for redlining.”
Sam Friedman, professor of sociology at LSE and lead author of the study, said: “We need to challenge the common assumption that if you tax the rich, they will leave. The rich are not only firmly entrenched, but also acutely aware of the stigma of tax migration — they are seen as overly self-interested or moving to places that others consider culturally sterile and boring.”