To ask His Majesty’s Government what assessment they have made of the number of individuals earning more than £100,000 per annum who left the country in 2025.

My Lords, not all taxpayers are required to notify HMRC when they leave the country. As such, the Government do not hold comprehensive data on the number of individuals leaving the UK by income level. The Government are committed to ensuring that the UK remains a competitive and attractive location for internationally mobile talent and investment. We continue to support growth through a competitive tax framework and a world-leading business environment.

The Minister is right: HMRC has no idea of the number of people who have left the country with a high income. The Chartered Institute of Taxation and I have tried to find the information, but it does not exist. However, most helpfully, the Sunday Times last Sunday looked at people on the Companies House database who have told Companies House that they are leaving the country. It estimates that as few as one in six and as many as one in three of the people on the Sunday Times wealth list have left the country. Can the Minister explain why he thinks that is and how this helps the growth agenda?

As the noble Lord says, the data is not available, so I am not sure that he can make the conclusions that he seeks to make. The data will not be available until we have the January 2027 self-assessment data, which is the most reliable data. The costings that were certified by the OBR for the previous Government’s and this Government’s reforms account for a potential behavioural response. They factor in an assumed level of migration from non-doms, just as they did for the previous government reforms. The OBR has said that there is no evidence to change the estimated impact of the reforms on migration. This has always been a highly mobile population. For example, in 2023-24, there were 9,100 arrivals and 9,500 leavers, so the noble Lord knows that this is nothing new. The reforms to the tax treatment of non-doms have been designed specifically to make the UK competitive, with a modern, simple tax regime that is also fair.

My Lords, I have a personal interest in this. Do the Government recognise that outdated tax treaties are driving away talent that the UK wants, especially in life sciences and AI? Many overseas nationals, especially Americans, end up paying significantly more tax than any equivalent UK-only citizen. It is not a non-dom issue but a failure to modernise relief to deal with tax savings such as ISAs, investments in mutual funds and the complexity of death duties. Will the Government get to grips with this?

The new residents-based regime is more competitive for new arrivals than the previous rules. It is more attractive than the previous approach. They can bring their foreign income and gains into the UK without attracting an additional tax charge. These changes will encourage individuals to spend and invest these funds in the UK.

My Lords, is it not the case that if you are a patriot you are obliged to pay your fair share of tax and that people who do not want to do that are not patriots?

We must ensure that the wealthiest pay their fair share of tax towards the public finances. Equally, successful businesses and entrepreneurs who create jobs and wealth are the engine of economic growth in this country and we must do all that we can to support them.

My Lords—

My Lords—

My Lords, it is the turn of the Cross Benches.

My Lords, does the Minister agree that the tax avoidance industry in this country appears to continue to thrive? If so, how does he explain that?

This Government have been very clear that we will close down any tax loopholes that we can while ensuring that the tax regime remains highly competitive. That is exactly what we are doing.

The Minister talked about celebrating entrepreneurs and business creation. According to City A.M., nearly 6,000 British business owners have quit the UK over the past two years. Why is this?

As I have already said, there is no reliable data to back up the noble Lord’s claims. The reliable data will be available in January 2027, when the self-assessment returns are made. The data does not exist to make the noble Lord’s claims. The UK is a great place to start a business, but our companies are not scaling at the same rate as their US peers. We are taking action to ensure that they do, that the business environment in this country remains competitive and that we have a competitive tax regime.

My Lords, is my noble friend the Minister aware of the hard data provided by Patriotic Millionaires, which shows that the strong majority are proud to live in this country, believe that it is patriotic to pay their fair share of tax and, in fact, are prepared to pay a little more, particularly to help young people?

I am aware of the points that my noble friend makes and agree with much of what she says. As I say, successful businesses and entrepreneurs who create jobs here and wealth in the UK are the engine of economic growth and we need to support them to succeed. As my noble friend says, we must also ensure that the wealthiest pay their fair share towards the public finances.

My Lords, we should encourage rich people to reside and stay in the UK, as, for example, the top 1% of those paying income tax contribute 29% of receipts. Unfortunately, government policies not only on non-doms but on inheritance tax and other taxes have encouraged them to leave in large numbers—young as well as old people. Since this is against the national interest, will the Government adjust their policies to reverse this unfortunate trend and study the detail further?

No, and I do not think the noble Baroness can make those claims based on the data that is available, as I have already said. The previous Government’s reforms assumed that there would be migration of non-doms. This Government’s reforms assume that there will be migration of non-doms, and the OBR has said that there is no evidence to change the estimated impact of the reforms on migration. Reforms to the tax treatment of non-doms have been designed specifically to make the UK competitive, with a modern, simple tax regime that is also fair. The noble Baroness mentioned other tax reforms; in the round, the Government’s reforms to the non-dom regime and to capital gains tax keep the UK an attractive place in which to live and invest, while ensuring that everyone who is a long-term resident pays their taxes here, helping to fairly fund our public services.

My Lords, does the Minister remember the argument, at the time of the Brexit referendum, that the divide in Britain was between the intellectual elite, who were people from anywhere, and the real people of Britain, who were people from somewhere? Are we not hearing an argument that it is the rich who are the people from anywhere, who do not have any particular loyalty to Britain and who might move, and that the rest of us are much more patriotic? Could we not hope to hear an argument from the Conservative Party and Reform that the rich should also be patriotic and committed to this country?

I absolutely understand the points that the noble Lord is making but am not sure that it is for me to speak on behalf of any other party. I just point to my noble friend’s remarks about Patriotic Millionaires: the vast majority of people in this country feel patriotic about their country and want to pay their taxes here.

My Lords, for the avoidance of doubt—as the lawyers are fond of saying—it would be interesting to know from the Minister whether someone earning more than £100,000 a year and paying their taxes can still be classified as a working person.

A working person is someone who goes out to work.

My Lords, will the legislation in relation to Members of this House envisaged in the King’s Speech deal with those who are refusing to pay their fair share of tax?

I am happy to say that that is probably not a matter for me.

My Lords, is not the problem that the people who are fairly paying their tax feel that they unfairly have to support a vast number—maybe just as many—who are living on welfare and benefits, and that the people who work hard have to support those who do not? I sense a growing feeling of unfairness.

I would just point out to the noble Baroness that the vast majority of people on benefits, as she puts it, are also in work—working hard every day to provide for their families. It is quite right that the state should help them to do so.

My Lords, the point is that £100,000 is not a huge amount of money. I am glad that the Labour Peers want to pay, but it is very important to encourage people to stay here to keep their money in the country. If they are taxed beyond belief, they will leave. That is not just any old Conservative Peer but people throughout the streets. The Minister must know that, but does he agree?

The noble Lord says that £100,000 is not very much money. He may like to know that average earnings are around £33,000, which is well below the higher-rate threshold, and around 80% of taxpayers pay only the basic rate.