26 August 2009
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A stream of hedge-fund managers and other financial-services professionals are quitting the U.K., following plans to raise top personal tax rates to 51%.
Lawyers estimate hedge funds managing close to $15 billion have moved to Switzerland in the past year, with more possibly to come. David Butler, founder of professional-services firm Kinetic Partners, said his company had advised 23 hedge funds on leaving the U.K. in the 15 months to April. An additional 15 are close to quitting the U.K., he said.
Since the UK doesn't have much in the way of revenue earning private enterprise outside of the financial services sector this is not good news for the UK treasury and public debt. The article goes on to show that the gnomes of Zürich aren't stupid enough to miss an opportunity to benefit from the HMG's stupidity:Matthew Feargrieve, London-based partner at offshore law firm Mourant du Feu & Jeune said the combination of higher taxes and prospective EU rule tightening was potent. The Swiss cantons of Zug and Zurich plan U.K. shows designed to lure businesses from London.
Swiss cantons are prepared to agree to ultralow tax rates with people bringing business to the country. Even without discounts, Zug's tax charge is just 14%.
As the article finishesFiona Sheffield, a partner in the hedge-funds tax practice at accounting firm Ernst & Young, said in June: "We have had most of the 250 hedge-fund managers we provide services for talking about the pros and cons of leaving the U.K. for Switzerland."
I'll be happy to give some pros and cons on Swiss living myself but compared to the UK I'd move over in a heartbeat even without the tax issues. Zurich is a far niceer city than London.