Lisa Nandy blames EU exit for capital’s declining elite population, while Labour faces criticism over tax policy and investor confidence
Culture Secretary Lisa Nandy has attributed the sharp decline in London’s millionaire population to Brexit, amid growing concern over the city’s fall from the world’s wealthiest rankings.
According to a report by New World Wealth and Henley & Partners, the British capital has dropped out of the top five richest cities globally, losing a greater proportion of millionaires than any other metropolis except Moscow. Over the past year alone, 11,300 dollar millionaires, including 18 with fortunes exceeding $100 million and two billionaires, have departed London.
While some critics have pointed to Labour’s recent overhaul of the non-domicile tax rules, which now require permanent foreign residents to pay standard UK taxes, Nandy maintains that the primary driver behind the capital’s wealth drain is Britain’s withdrawal from the European Union.
Speaking on Sky News, she said: “The report identifies various contributing factors, but Brexit stands out as a key cause. That’s why we are committed to negotiating a much improved arrangement with the EU that protects and promotes British business.”
Nandy highlighted how the cultural and entertainment sectors, especially touring artists, have suffered due to reduced mobility between the UK and Europe, adding: “Closer collaboration is in everyone’s interest.”
Despite growing unease among investors, the culture secretary defended the competitiveness of the UK’s business environment. “Britain still has the lowest headline rate of corporation tax in the G7,” she said. “Some argue we’re taxing the wealthy too much, others say not enough. That tells me we’re striking a fair balance.”
The Office for Budget Responsibility previously estimated that Brexit would lead to a 4% long-term contraction in the UK economy, largely due to non-tariff barriers affecting trade with the EU.
Labour leader Sir Keir Starmer has called for a “reset” of the UK’s relationship with Europe, aiming to revise the post-Brexit trade deal brokered by Boris Johnson’s administration.
The millionaire exodus coincides with the introduction of a new tax regime for non-doms, which removes their former preferential treatment. London and Moscow are the only two cities in the top 50 global wealth centres to have fewer affluent residents than a decade ago.
Since 2014, the capital has seen a 12% drop in its wealthiest population, now standing at approximately 215,700 millionaires. The report links this decline to a combination of factors: Brexit, higher taxation, and the depreciation of sterling. Moscow’s 25% decline, in contrast, has been driven by geopolitical instability and the consequences of Russia’s invasion of Ukraine.
The findings have reignited debate over whether the government should introduce a formal wealth tax. However, Paul Johnson of the Institute for Fiscal Studies has voiced scepticism, warning that no country has yet managed to implement such a tax effectively, citing major logistical hurdles.
This discussion emerges as Labour pushes forward with welfare reforms expected to affect up to one million disabled individuals, fuelling further debate over fairness and fiscal responsibility in the post-Brexit era.
