The UK tech industry is on edge as speculation grows about potential changes to capital gains tax (CGT) in the upcoming Autumn Budget.
Leading audit and advisory firm Blick Rothenberg has expressed concerns that such changes could have a detrimental impact on the fintech ecosystem, a key driver of the UK’s global technology reputation.
Simon Gleeson, partner at the firm, commented: “This has been a turbulent week for the UK tech sector. Keir Starmer’s ambiguous stance on potential tax rises, as hinted at by Rachel Reeves at the 2024 International Investment Summit in London, has only served to heighten the uncertainty.” Certainty.
The letter, signed by 66 fintech leaders, warning of a potential exodus if CGT increases, has added to growing concern. Gleason noted that some employees at Monzo are looking to cash out before the budget, fearing higher tax rates.
He added: “Startups and founders, known for their resilience and vision, may face what looks like punitive measures if they are taxed more heavily for long-term rewards. Such changes risk sending negative signals to international investors, undermining the UK’s appeal as a hub for talent and innovation.”
Despite the uncertainty, the government struck a positive note at the summit, highlighting £63bn of new investment and the creation of 38,000 jobs. However, the upcoming budget remains a major source of apprehension.
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