As the pound plummets, is it time for ...Dubai, Doha, Geneva, or Singapore?
The exodus may not be upon us, but there are various signs that some kind of mass exit from London remains a possibility.
Swiss paper Sonntag reported at the weekend that Credit Suisse is thinking of relocating 200 investment bankers to Switzerland as a means of avoiding the bonus tax (bizarrely, CS is apparently trying to escape tax accrued on bonuses issued between December 2009 and April 2011, even though the tax is supposed to lapse in April 2010).
UBS is said to be eyeing up a similar move. And, as has been widely reported previously, hedge funds like Brevan Howard and Bluecrest are already busy transplanting high earning staff to Switzerland.
Switzerland is NOT the only option
However, a move to Switzerland is not mandatory if you want to avoid either the plummeting pound or the UK's increasingly punitive tax regime - which as these charts show means the country will soon rank 18th among the G20 for net income left from 250k.
Last week, it emerged that hedge fund Aureos Capital was moving out of London to Singapore (top rate of income tax 20%) for tax reasons.
Separately, the head of one financial services headhunter in London says Credit Suisse has seriously looked at shifting some of its business to Dubai, where the tax rate is zero. And search firm Kinsey Allen issued a press release today predicting the creation of 5,200 new financial services jobs in Qatar during 2010 as expats favour it over other Emirates [Dubai] and foreign investment 'floods' in. There are also plans to allow bond trading on the Qatari exchange sometime before September.
Putting living standards to one side
Qatar isn't known for being the most liberal place in the world (nor is Singapore), but London headhunters say people no longer care.
"The feeling is that you can move to the Middle East, have ten good years and retire - it's going to be a lot harder to do that in the UK from now on," says one.
"I haven't come across anyone who says they don't want to get out of London," says another hedge fund recruiter. "We have a number of offshore searches at the moment, and people are jumping at them."
However, she adds that Switzerland isn't always people's preferred destination. "When you run the numbers, Switzerland isn't as good as everyone thinks. The cost of living is enormous and the cheapest cantons aren't the financial services centres. You can move there and end up being in a random place, equivalent to a provincial town Surrey."
