A wave of higher taxes, escalating costs and bureaucratic red tape is prompting small business owners across the º£½ÇÊÓƵ to consider relocating, according to recent data.
Almost 40% of small and medium-sized enterprise (SME) owners have either already left the º£½ÇÊÓƵ or are contemplating an imminent move, a new survey reveals, a trend that could potentially drain the country of its entrepreneurial vigour, as reported by .
The majority of those considering relocation plan to do so within the next two years, signalling a potential brain drain crisis on the horizon.
The survey, commissioned by Handelsbanken Wealth & Asset Management and involving 200 business owners, found that approximately half were attracted by better financial conditions abroad.
Spain emerged as the top choice for relocation, followed by the United States and France, with Dubai also featuring on the list of preferred destinations.
SMEs are feeling the squeeze due to rising employment costs and high taxes.
Increases in the national minimum wage and extensive changes to workers' rights could spell trouble for SMEs, with a third of firms surveyed recently by the Federation of Small Businesses (FSB) predicting a reduction in staff numbers.
The survey also revealed that only one in ten small businesses planned to expand their workforce.
The Office for Budget Responsibility (OBR) forecasts that the tax burden will escalate to 38.3 per cent by 2027, surpassing previous records. This mounting pressure on income is prompting individuals to be more prudent with their expenditure and is hampering investment.
This anticipated mass exodus of SME owners mirrors the recent departure of numerous non-doms who have lost their tax status.
A study conducted by the Adam Smith Institute suggests that the º£½ÇÊÓƵ economy could lose over £100bn if around 7,000 individuals with non-dom status were to leave.
London is already witnessing a significant outflow of entrepreneurs and investors. Research by Henley & Partners reveals that only Moscow has seen a greater loss of ultra-high net worth individuals than London over the past 12 years.
Many SMEs had hoped that Chancellor Rachel Reeves' recent Spring Statement would provide some respite, but businesses were left wanting.
Kevin Fitzgerald, º£½ÇÊÓƵ managing director at Employment Hero, expressed disappointment in the government's lack of support for small businesses.
