Britain ‘becoming incubator nation’ of firms that flee London
The UK is at risk of becoming an “incubator nation” which creates promising start-ups before losing them to rival markets, John Healey has been warned. The Chancellor has been told to take immediate action to revive the London stock market, as City leaders warned that the exodus of British start-ups is “not business as usual”. [...]
The UK may be transforming into a hub for companies fleeing London, warned Chancellor John Healey. The London stock market is facing an exodus of start-ups, according to the Capital Markets Industry Taskforce (Cmit), led by LSE chief Dame Julia Hoggett, in its pre-budget submission to the Treasury. The document warns that London's IPO pipeline is "shrinking", citing the £24bn sale of Cambridge-based Arm Holdings to SoftBank as evidence.
City leaders have handed Healey a list of demands to revive the market, including removing stamp duty on shares for pension funds and ISAs and implementing a 10% tax credit on dividends for pension funds. While the government may be unwilling to abolish stamp duty due to the £3bn it generates annually, they could consider an inheritance tax relief on pensions invested in the UK over a 15-year period.
The Cmit argues that these measures could mobilise £125bn in equity by 2042, addressing a "strategic growth problem" that threatens the UK economy as a whole.
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