In the current economic and political scenario the rich are finding it difficult to protect their enormous wealth. It is one thing to become rich and totally another to remain rich. The persisting economic uncertainties are pushing the politicians to lean towards left of the center policies. These welfare measures require large scale funding that can be arranged only by taxing the rich. The global rich want to escape this prospect and are on the move to find the right destination where they can secure their wealth.
Millionaires and billionaires around the world are migrating like never before. The French or Americans are taking this step to flee the prospect of higher taxes and the Russians and Chinese are trying to escape political uncertainty. In any case, the figures according to government statistics and relocation experts are startling. The wealthy, more often than not, have global businesses and they feel that they need not be bound to a particular country.
David Lesperance, a Toronto-based attorney who specializes in relocating the rich highlighted the reasons behind the growing trend. He feels that after the global downturn and recession the rich have become very cautious about their fiscal health and are constantly looking to improve it. Migration for them is no more an interesting or exotic concept but a necessity. The rich are not just looking for most expensive holiday destinations or the most expensive global tour but stable and culturally rich locations.
The most surprising figures come from America where the number of people seeking to renounce their citizenship surged to more than 1,700 last year. The figure is twice as big as the figure two years ago. Andrew Mitchel, the international tax attorney was analyzing the US Treasury data and pointed out that this year too the trend seems to be accelerating as 460 people have migrated from America in the first quarter alone. Eduardo Saverin, a Facebook billionaire is a prominent name that moved out of America and shifted base to Singapore last year. The recent Presidential elections in France has ushered in a change and wealthy in France are apprehensive about the proposal of 75% tax on income exceeding 1 million euros made by the new incumbent President Francois Hollande.
The rich in France are primarily looking at Switzerland, Britain and Singapore as possible escapes from the new socialistic tax regime. The number of applicants in the forfait system in Switzerland which allows foreigners to immigrate through a special tax treatment has swelled to 5,445 and over one third of the applicants are French. They feel that there is a growing hostility toward the rich in France.
The new rich in the emerging markets like Russia, China and Brazil face a different predicament. The high speed growth of last decade has slowed down and the political uncertainty at home has encouraged them to look for more stable environment in Britain or United States. Wealthy Russians have moved to London in large numbers. Roman Abramovich, the Russian multi-billionaire who owns the Chelsea Football Club is the highest-profile rich Russian in Britain.
They are primarily attracted to the stability and refined culture of London. However, the Chinese millionaires and billionaires are flocking to the United States in record numbers. They normally take the investor visa route that allows you permanent residency for a minimum investment that can create a certain number of jobs in the US. The basic fact is that the rich are following the rule of capital which is simple – money moves to where it is treated the best.