Where have all the millionaires gone?
That’s a question many Britons are asking now that new data show nearly two-thirds of the country’s million-pound earners have disappeared not even one year after a tax hike on the nation’s highest earners went into effect.
Britain’s Telegraph newspaper reports that just 6,000 Britons declared income over a million pounds ($1.6 million) to the nation’s tax authority, down from more than 16,000 in the 2009-10 tax year.
Former Labour Party Prime Minister Gordon Brown raised the top rate from 40% to 50% in 2010, shortly before losing the general election to Conservative Prime Minister David Cameron.
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The closely watched wealth tax was a disappointment from the beginning, with the first monthly receipts last January bringing a half a billion pounds less than the same month in 2011.
The Telegraph reports the tax increase has so far cost the U.K. Treasury 7 billion pounds.
Seeking to arrest this trend, Britain’s Chancellor of the Exchequer George Osborne announced that the top 50% rate would be reduced to 45% beginning next April. The British newspaper reports the number of Britons reporting million-pound incomes has risen to 10,000 since Osborne’s announcement.
The U.K. Treasury may yet have some extra, unexpected help from millionaires. Not to be outdone, France’s new prime minister, Francois Hollande, has pushed through a much higher wealth tax, with a top rate of 75% on residents of France earning 1 million euros ($1.3 million).