There’s a particular kind of phone call private client advisers in London have got used to. It happens on election nights, or the morning after a Budget, and it goes something like this: “I’ve made my decision. I’m moving to Italy.” Not “I’m thinking about it.” Not “talk me through my options.” Decided, within hours, before the ink on the announcement is even dry.
I bring this up because most of the public conversation about non-doms leaving the UK has turned into an argument about whether it’s actually happening at all. Some reports on the numbers have been picked apart. Others have been quietly walked back by the very people who published them. Honestly, I’ve stopped paying much attention to the exodus headline count, because I don’t think it’s the interesting question anymore. The interesting question is whether the government priced in how people actually behave, and I don’t think it did.
People don’t respond to policy. They respond to confidence.
Every private client adviser watching this closely says roughly the same thing: policy sets the backdrop, but confidence drives the decision. That distinction matters more than it sounds like it should. A change in tax rules doesn’t automatically send people packing. What sends people packing is the sense that the ground could keep moving, that this year’s change is a preview of next year’s, and that staying put means staying exposed to whatever comes next.
That’s a much harder thing to model in a Treasury spreadsheet than a tax rate is. You can calculate exactly how much revenue a policy raises if every affected person stays exactly where they are and behaves exactly as they did before. What you can’t easily calculate is the moment someone decides they’ve had enough of being the experiment.
We’ve seen this film before, in other countries
This isn’t a hypothetical. France, Austria and the Netherlands have all tried a version of taxing wealth more aggressively, and all three eventually reversed course, for the same basic reason: the people the tax was designed to capture left faster than the revenue could be collected. Not eventually. Quickly. A tax you can’t collect because the taxpayer has already gone is not a tax, it’s a headline.
What strikes me is that none of those reversals appear to have been treated as a warning here. They happened, they were reported, and then the same basic assumption got made again anyway: that wealthy, mobile individuals will sit still and pay up because the sums say they should. People with the means and the international connections to leave within a week are, by definition, the group least likely to just absorb a change quietly.
The bit that actually gets lost in this
When someone with real wealth leaves, they don’t just take their own tax bill with them. Several advisers have made the same point to me in different words: these individuals often employ people, invest in businesses, sit on boards, fund things. When they go, the loss isn’t a single missing tax return, it’s a small removal of activity from the economy around them. That’s much harder to headline than a departure count, and it’s probably the more expensive part of the story.
I’m not going to pretend I know the “right” tax policy for non-doms, and I’d be suspicious of anyone in my position who claimed they did. But you don’t need to take a side on fairness to notice that other countries ran this exact experiment and pulled back once the numbers stopped working, and that Britain doesn’t appear to have asked itself why. You can legislate against wealth. You can’t legislate against someone’s ability to leave.
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