The executives of some of the UK’s most valuable technology start-ups have issued a warning to Rachel Reeves about potential tax increases in the upcoming budget that could lead them to reconsider listing their companies on the London Stock Exchange. A letter obtained by Sky News from companies like Revolut, Funding Circle, OakNorth, Clearscore, and Quantexa urges the chancellor not to impose an exit tax on wealthy individuals or make decisions that could harm confidence and investment in the UK. The signatories, with a combined value of over $100bn, are key candidates for listing on the UK equity markets, and they emphasize the importance of maintaining the country’s attractiveness for founders and investors. The letter, sent by the Unicorn Council for UK FinTech under Innovate Finance, calls for support for the fintech industry and the broader economy by reversing recent changes to capital gains tax and inheritance tax rules. have made the UK less attractive to entrepreneurs seeking to start a new business, and to the highly skilled talent that will help drive these startups,» the executives warned in a letter to Rachel Reeves. They specifically cited the reduction in the lifetime limit for Business Asset Disposal Relief from £10m to £1m as a factor in weakening the UK’s «ability to attract and retain founders.»
The letter, signed by executives from companies such as Revolut, Funding Circle, OakNorth, Clearscore, and Quantexa, highlighted the importance of a stable and favorable taxation environment for founders to take the risk of building a business in the UK. The executives emphasized that any potential changes to the fiscal environment could make the UK less attractive to existing and potential founders, resulting in reduced investment in UK start-ups, hindered growth efforts, and potential delays or cancellations of plans to list shares publicly in the UK.
The executives urged the chancellor to demonstrate support for Britain’s fintech industry and the wider economy by reversing changes to capital gains tax and inheritance tax rules. They emphasized the impact of these tax-raising measures on their plans to list their companies on the London Stock Exchange and called for measures to maintain confidence and encourage investment in the UK.
The letter, sent under the aegis of the trade body Innovate Finance’s Unicorn Council for UK FinTech, comes at a critical time as the chancellor prepares to deliver her second budget on November 26. With industries lobbying against steep tax hikes, including a potential increase in the basic rate of income tax, the executives’ warning underscores the potential consequences of tax-raising measures on the UK’s attractiveness for entrepreneurs and investors. have made the UK less appealing to entrepreneurs looking to establish new businesses and attract highly skilled talent. One of the factors cited was the reduction in the lifetime limit for Business Asset Disposal Relief from £10m to £1m, which weakens the UK’s ability to attract and retain founders.
The letter, signed by executives from companies such as Revolut, Funding Circle, OakNorth, Clearscore, and Quantexa, emphasized the importance of a stable and favorable taxation environment for founders to take the risk of building businesses in the UK. These entrepreneurs have been courted by Chancellor Rachel Reeves in recent months, with roundtable events and efforts to position London as an attractive stock exchange for technology businesses.
Despite recent successes in the UK equity market, concerns remain about the impact of potential tax hikes on businesses. Executives warned that tax-raising measures in the upcoming budget could lead to companies canceling plans to list on the London Stock Exchange, impacting confidence and investment in the UK.
The letter urged the chancellor to reconsider changes to capital gains tax and inheritance tax rules to support the fintech industry and drive economic growth. The signatories, collectively representing companies valued at over $100bn, highlighted the importance of maintaining the UK’s attractiveness to founders and investors to foster innovation and growth.
With expectations of steep tax hikes in the budget, industries such as banking and gambling have intensified lobbying efforts to avoid unfavorable tax changes. The possibility of an increase in the basic rate of income tax looms as the chancellor seeks to address a significant fiscal gap.