Most entrepreneurs take massive personal and financial risks and employ people without taking a salary themselves for the first fews years in the hope the risk will pay off in the future. They will simply move to Singapore, the US etc if we remove the incentives and reward.
Is this the biggest political own-goal in history?
I’ve just come off a call with a founder who’ll sell his business for £150 million next year.
He’s now taken the decision to relocate overseas prior to the completion of the sale.
He’s moved from the acceptance of paying 20% capital gains tax on the sale proceeds, through the possibility of paying 39% and has now concluded that he can avoid paying anything at all.
As a result, HMRC will lose a minimum of £30 million (assuming rates remain unchanged) in tax receipts.
And that’s just one transaction.
This is the Laffer Curve playing out in real time.
I’m currently receiving multiple calls and emails from other founders exploring exactly the same idea.
Whatever your political views are, this has been a disastrous PR exercise from the government.
In business and the economy, confidence is everything.
It’s going to take a long time to turn this sentiment around.