Attracting skills: Proposals are being considered for people willing to fund sectors seen as strategically important by Starmer’s administration such as AI, clean energy and life sciences. — Bloomberg
LONDON: The UK is drawing up plans for a special visa for foreigners who invest significant sums in Britain, as Prime Minister Keir Starmer’s government seeks to blunt the economic blow from recent tax hikes and wider curbs on work permits.
Ministers are considering proposals for an investor visa open to people willing to fund sectors seen as strategically important by Starmer’s administration such as artificial intelligence or AI, clean energy and life sciences, according to sources.
The visa plans are at an early stage, subject to change, and being considered alongside making existing visa routes easier for investors, said the sources.
The preparatory work on a new investor visa comes against the backdrop of Starmer’s self-declared priority of boosting the British economy and a backlash over efforts to roll back “non-dom” tax breaks for wealthy foreigners who reside in the UK.
Starmer’s government has seen a flurry of Britain’s richest residents leave the country due to the tougher tax rules implemented by Chancellor of the Exchequer Rachel Reeves in April.
Starmer’s administration is also trying to make up for the economic hit from its decision to hike the national insurance payroll tax at Reeves’ first budget last October, a move that has caused a downturn in hiring and hit business confidence, as well as a broader clampdown on visas announced this week.
Starmer has said he wants to bring down immigration “significantly,” a stance that is likely to lead the Office for Budget Responsibility, to lower its growth projections, given how the fiscal watchdog tends to score the influx of people as contributing positively to Britain’s economic output.
The British government published a white paper this week that set out its future plans on immigration, and it said it wanted its migration system to “attract the best talent, entrepreneurship and investment into our country.”
It also pledged “faster routes for bringing people to the UK who have the right skills and experience to supercharge UK growth in strategic industries.”
The Home Office, Treasury and Business and Trade Department were all agreed on the need to attract the best and brightest to Britain in the pursuit of economic growth, a government official said.
The Home Office declined to comment. The Treasury didn’t immediately respond to a request for comment.
While the government is wary about reviving problems associated with past “golden visa” programmes, an investor visa could signal that the UK is charting a different course from the European Union, which is trying to curb migration incentives aimed at the rich.
US President Donald Trump, meanwhile, has sought to lure foreign investors stateside with a programme that offers residency and a path to citizenship to investors who pay US$5mil to the US Treasury.
Britain previously had a “Tier 1” investor visa that gave wealthy foreigners a path to residency if they invested at least £2mil (US$2.7mil) in local companies.
However, the visa was scrapped in 2022 by the former Conservative government as part of a crackdown on illicit finance and fraud, at a time when Britain was concerned about the influence of Russian money in the UK.
Starmer’s government is keen to avoid the pitfalls of the previous investor visa, which was criticised at the time as being abused to funnel dirty money into Britain, and hence is considering restrictions such as requiring investment to occur in specific strategic sectors, and excluding assets like property, according to the sources.
Access to the visa is likely to be strictly controlled and there would be thorough processes to minimise the risk of money-laundering, the sources said. — Bloomberg
