TThe British public overwhelmingly supports imposing a wealth tax on the wealthy. But how do wealthy people feel about this prospect? It's hard to identify. Our best guess is probably by the “experts” who manage wealth and luxury consumption, such as bankers, tax advisors, lawyers, real estate agents, art advisors, and yacht brokers. These professions often represent the wealthy as rational economic agents who would protect their money by moving to a low-tax country if forced to do so, regardless of the social consequences.
But what do the wealthy think? It's becoming difficult to directly gather what people are thinking and feeling about something. Between celebrity magazine spreads and wealth management industry ventriloquism, the wealthy have become caricatures. Not a real person, but an urban legend.
I spoke with 60 millionaires, billionaires, aristocrats and their servants to try to rectify this problem. Researching my book, “Serious Money: Walking through Plutocratic London,'' I found that although there are few paths to becoming wealthy, such as selling a company, finance, real estate speculation, and inheritance, the wealthy themselves are very diverse. It turns out that it is. London's wealthy in particular come from all over the world, drawn to London's attractive affordable housing, cultural scene, schools, available financial expertise, rule of law and easily open borders. .
Wealthy people definitely travel in more ways than other people. But frequent vacations, multiple homes, and elite forms of travel are not the same as hypermobility to avoid taxes. The rich people I met liked the London lifestyle. They are unlikely to move to Dubai or Texas due to increased taxes. They have lives, children and dogs, and can afford to live in London. Pay more taxes. A recent study from the Institute of Labor Economics confirms this, concluding that the mobility of the wealthy in response to tax increases is “less than previously thought.”
There are well-known examples of billionaires emigrating or threatening to emigrate to avoid paying taxes. Phones4u founder John Caldwell said he would flee to Monaco or the south of France if former Labor leader Jeremy Corbyn was elected prime minister in 2019. I don't know if he actually does that. Tax havens like Monaco have a certain appeal. Jim Ratcliffe, the petrochemical billionaire and new co-owner of Manchester United, moved to his home in Monaco in 2020 to save £4bn in taxes. Philip Green also lives there, while Richard Branson is in exile in the British Virgin Islands.
But my conversations with wealthy people suggest that Caldwell, Ratcliffe, Green, and Brunson are outliers. Many people I talk to admit that they have more money than they will ever spend in their lifetime. Some people donated money and were happy to talk to me about the challenges of “giving well.” This means where money can have the greatest impact. Of course, they tend to support their pet's cause. Their philanthropy is often It's a way to expand their social networks while distracting us from thinking about their wealth. King Charles is the main promoter of this.
But there are signs that attitudes are changing. Whether out of guilt over their level of wealth or concern for the plight of the poor, wealthy people are clearly uncomfortable stepping over homeless people on their way to the opera. The grotesque inequalities and serious nature of the climate crisis are causing more people to reflect on their consumptive lifestyles. Resource Justice is an organization dedicated to instructing wealthy people on how to spend their money to support “grassroots social movements.” Meanwhile, patriotic millionaires are campaigning against wealth inequality. The latter group commissioned a poll of the ultra-wealthy to coincide with the World Economic Forum in Davos, which found that 74% supported increasing taxes on wealth.Effective altruism – a philosophy that favors using excess income to fight hunger and poverty instead Rather than spending money on luxury goods, it's more prevalent among high finance and Silicon Valley billionaires.
So why is Labor reluctant to propose this, when even some wealthy people are willing to tax their wealth? This is especially strange given that support is becoming more mainstream.According to his recent YouGov poll, 73% of British citizens support her 2% tax on assets over £5m. Gus O'Donnell, a cabinet minister in both Labor and Conservative governments, even suggested there was “a clear basis for wealth-targeted tax reform”.
Wealth taxes can be annual or one-off, such as Tony Blair's windfall tax on privatized electricity companies in 1997. LSE and Warwick University research suggests one-off tax A 5% levy on total assets over £500,000 would raise £2.5bn over the next five years. This is equivalent to the annual budgets of the NHS and education combined.
If Keir Starmer can silence the voices of those who speak for the wealthy, and the hardline billionaires who seek to influence countries to make short-term changes to public finances, then the British people and many wealthy You will hear that even the class themselves support a wealth tax. . In 2022, 1 million children in the UK will experience extreme poverty. The funds raised by a wealth tax have never been more needed.
