Revitalizing the City: A Call to Action
The newly appointed Lord Mayor of London, Alastair King, has sounded the alarm on the detrimental impact of the UK’s share stamp duty on British businesses. In a bold move, he is urging the Chancellor to reconsider this tax, which he believes hinders investment and growth.
A Disadvantageous System
Currently, investors pay a 0.5% levy when buying shares, forecasted to generate £4.2bn for the public coffers in 2024-25. However, this tax does not apply to investments in US tech giants listed on the New York stock exchange. Mr. King argues that this creates an uneven playing field, where British investors are at a disadvantage when investing in their own home-listed companies.
A Plea for Regulatory Reform
The Lord Mayor is pushing for a comprehensive overhaul of the regulatory environment, which he believes has failed to keep pace with the evolving markets. He is advocating for the abolition of stamp duty on shares outside the FTSE 100, a move that would cost a relatively modest £650m. Additionally, he is calling for a review of Isa tax breaks, which he deems “bizarre” and counterproductive.
Restoring the City’s Former Glory
Mr. King acknowledges that the City of London is no longer as agile as it once was. To revitalize its fortunes, he suggests that the UK needs to adopt a more proactive approach to promoting itself to investors abroad. This requires a shift in public perception, moving away from the negative stereotypes that have plagued the City.
A Wake-Up Call
The recent exodus of high-profile companies from the London Stock Exchange, including Ashtead, serves as a stark reminder of the urgent need for reform. Mr. King warns that if the UK fails to address these issues, it risks losing its competitive edge and becoming increasingly irrelevant.
A New Era of Growth
By scrapping or reducing share stamp duty, the UK can unlock new opportunities for growth and investment. It is time for the City to reclaim its position as a global financial hub, and Mr. King’s clarion call for reform is a crucial step in that direction.
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