A new report by Spear’s Magazine and wealth consultancy WealthInsight has predicted that up to one in seven of Scotland’s richest inhabitants “could flee the country” in the event of independence.
With news coverage currently focused on bank contingency plans and the movements of big business, it’s certainly food for thought.
While you might have no personal interest in the whereabouts of Scotland’s elite, these individuals are worth an estimated £52bn in total. That’s quite a lot in future taxes, one would expect.
According to the data, 15 per cent of Scotland’s high net worths have their primary business in England, making them “prime candidates” to move south should the Yes campaign be successful. 22 per cent also have at least one major business interest across the border.
Not living in the same country as your business is undoubtedly a little messy, as analyst Oliver Williams points out: “Millionaires across the country may suddenly have to choose in which country to declare their domicile and where to keep their millions.”
Josh Spero, editor of Spear’s, adds: “If there’s one thing the wealthy – or indeed most people – hate, it’s uncertainty, not least over the laws and taxes which govern them.
“In the long, obscure and painful period between a Yes vote and eventual independence, wealthy Scots – and particularly those with business interests in England – might well hop the border to England, with its long-settled, reasonably advantageous tax system.
“That’s even before we learn what the Scottish rates of tax would be, which would almost certainly be higher to pay for generous health, education and welfare provision.”
Financial experts have highlighted that Scotland’s lack of double tax treaties might also impact negatively on high net worth individuals. No historical agreements could mean wealthy business people face taxation in more than one country – at least until the dust settles.
However not every high net worth believes that independence is such a bad idea. Yesterday, pro-independence group Business for Scotland announced that it now has 3,000 members. While last week, the No campaign received a significant boost when Tim Martin, Chief Executive of JD Wetherspoon, implored business leaders to stop talking “nonsense”.
“There’s no reason why Scotland shouldn’t thrive as an independent economy if that’s what the Scots want. New Zealand has the same population, Switzerland does very well and Singapore with half the population is an economic miracle. There’s no reason a small country can’t thrive,” he said.
Aoife Moriarty writes for Elite Traveler and Spear’s