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Taxation and Migration by the Super-Rich

Arun Advani, David Burgherr and Andy Summers
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Andy Summers: London School of Economics, III, and CAGE

The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics

Abstract: Using administrative data on the globally connected super-rich in the UK, we study the effect of a large tax reform on migration behaviour. Prior to 2017, o shore investment returns for `non-doms' - individuals tax resident in the UK but with connections to other countries - were untaxed. Average off shore investment returns for these individuals exceeded £420,000; even without considering other types of income, this puts them in the top 0.2% of the population. A reform in 2017 brought long-stayers and UK-born non-doms into the standard tax system, reducing their effective net of average tax rate by between 8.8% and 13.0%. We nd that migration responses were limited : our central estimate of the migration elasticity is 0.02, and across a range of specifications we can rule out elasticities larger than 0.5. Using reforms for the UK-born super-rich who were living abroad, we find that migration elasticities are limited even for recent arrivals, for whom our central estimate is 0.18. Assuming similar elasticities for all non-doms, abolition of the preferential regime would increase tax revenue collected from non-doms by £3.2bn (84%).

Keywords: taxation; migration; capital income; inequality; mobility JEL Codes: F22; H31; J61 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-acc, nep-eur, nep-lab, nep-mig, nep-pbe and nep-pub
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https://warwick.ac.uk/fac/soc/economics/research/w ... rp_1427_-_advani.pdf

Related works:
Working Paper: Taxation and Migration by the Super-Rich (2023) Downloads
Working Paper: Taxation and Migration by the Super-Rich Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:1427

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