The UK tech industry is on edge as speculation mounts over possible changes to capital gains tax (CGT) in the upcoming autumn budget.
Leading audit and consultancy firm Blick Rothenberg has expressed concern that such changes could have a damaging impact on the fintech ecosystem, a key driver of Britain’s global tech reputation.
Simon Gleeson, partner at the firm, commented: “This week has been turbulent for the UK technology sector. Keir Starmer’s ambiguous position on possible tax increases, as stated by Rachel Reeves at the International Investment Summit 2024 in London, has only increased uncertainty.”
A letter signed by 66 fintech leaders warning of a possible exodus if CGT increases has added to growing concerns. Gleeson noted that some employees at Monzo are reportedly looking to cash out ahead of the Budget for fear of higher tax rates.
He added: “Start-ups and founders, known for their resilience and vision, could face what feels like punitive measures if they are taxed more for long-term rewards. Such changes risk sending negative signals to international investors, undermining Britain’s appeal as a hub for talent and innovation.”
Despite the uncertainty, the government announced a positive note at the summit, highlighting £63 billion in new investment and 38,000 new jobs. However, the upcoming budget remains a major source of concern.