Sir Martin Sorrell, alongside a group of prominent entrepreneurs, has issued a strong plea to Chancellor Rachel Reeves ahead of the upcoming Budget, warning the government against policies that could stifle the spirit of entrepreneurship in the UK. The open letter highlights deep concerns among business leaders that escalating costs and tax rises introduced in last year’s Budget are damaging the country’s proud entrepreneurial tradition and prompting a worrying exodus of founders and investors.
The letter, signed by influential figures such as Nick Wheeler of Charles Tyrwhitt, John Roberts of AO World, and Steve Rigby of the Rigby Group, underscores how fiscal pressures including increased National Insurance Contributions and higher capital gains tax rates are driving successful entrepreneurs to seek more favourable environments abroad. They highlight that the UK has fallen to 23rd place globally in ease of starting a business, marking six consecutive years outside the top 20, a trend they attribute in part to government policy which they say must change to ‘empower the energy and dynamism of entrepreneurs, not stifle or constrain them.’
This warning comes amid high-profile departures from the UK by leading business figures. In October, Nik Storonsky, co-founder and CEO of the financial technology giant Revolut, formally changed his residency from the UK to the United Arab Emirates. This move follows significant tax changes, notably the abolition of the UK’s ‘non-domiciled’ tax regime that had allowed foreign nationals to shield overseas income from UK taxation. Storonsky’s stake in Revolut, valued at billions of dollars, and the UAE’s regime, offering no personal income tax, were significant factors influencing his decision to relocate. His shift of residency has been widely reported by financial and tech news outlets, confirming the growing appeal of the UAE as a tax haven for wealthy entrepreneurs increasingly disillusioned with UK tax policy.
Similarly, Herman Narula, head of the tech company Improbable and recognized as Britain’s richest self-made entrepreneur under 40, has also revealed plans to move to Dubai. Narula’s decision was reportedly influenced by the UK Government’s proposal of an ‘exit tax’ designed to dissuade wealthy individuals from moving abroad to avoid tax obligations. Speaking critically of these measures, Narula described the government’s approach as ‘anti-entrepreneur’ and warned that such taxes could deter future entrepreneurial ventures from even starting in the UK.
The collective concern from the entrepreneurial community aligns with warnings issued last October from the UK retail and hospitality sectors, which cautioned that thousands of jobs could be lost if plans to increase property taxes on larger shops, pubs, and hotels went ahead.
The current environment, characterised by intensified tax burdens and regulatory uncertainty, is thus threatening the UK’s standing as a competitive international business hub. The signatories and departing entrepreneurs paint a picture of a country at risk of alienating the very drivers of innovation and economic growth, urging the government to reconsider its fiscal approach in the next Budget.
As the government prepares its fiscal roadmap, the challenge remains to balance tax revenues and public spending needs with creating an environment where entrepreneurs feel encouraged to found, grow, and sustain enterprises in the UK rather than look overseas for more favourable conditions.
📌 Reference Map:
- [1] (Daily Mail) - Paragraphs 1, 2, 3, 4, 7, 8, 9
- [2] (Forbes) - Paragraphs 5, 6
- [3] (The National) - Paragraph 7
- [4] (Finextra) - Paragraph 5
- [5] (Irish Times) - Paragraph 6
- [6] (Sifted) - Paragraph 6
- [7] (FinanceFeeds) - Paragraph 5
Source: Noah Wire Services