The United Arab Emirates is positioned to maintain its reign as the top wealth destination globally for the third consecutive year, as per the Henley Private Wealth Migration Report. Meanwhile, the United Kingdom is anticipated to witness a decline of 17% in its millionaire population by 2028, based on projections from Swiss bank UBS. The allure of tax-free expat hubs such as Dubai has been enticing high-net worth individuals to make the move, especially with the rising costs and taxes in their home countries.
The decision of millionaires to relocate to Dubai is influenced by a combination of push and pull factors. Push factors include concerns about potential tax increases under a new government, such as the Labour Party in the U.K. considering levying VAT on private school tuition. On the other hand, pull factors include Dubai’s reputation for safety, as well as visa reforms that promote migration to the UAE.
The UAE is on track to experience a historic net inflow of 6,700 millionaires from across the globe by the end of 2024, according to the Henley report. This figure is almost double that of the United States, which is expected to welcome 3,800 millionaires during the same period. The appeal of the UAE lies in its zero income tax regime, golden visas, luxurious lifestyle, and strategic location, solidifying its status as the top destination for migrating millionaires.
Development of Wealth Management Ecosystem
Significant development and reforms in the UAE’s wealth management sector have contributed to attracting high-net worth individuals. Sunita Singh-Dalal, a partner at the Hourani Private Wealth & Family Offices in Dubai, attributes much of this success to the country’s implementation of a robust regulatory framework that offers innovative solutions for wealth preservation and enhancement. Factors such as modern infrastructure, a strong international school system, geographical connectivity, low crime rates, the absence of income tax, the remote worker visa program, and various investment incentives further enhance Dubai’s appeal to the wealthy.
In contrast to the UAE’s growth, the U.K. is projected to see a decline in its millionaire population from 3,061,553 in the previous year to 2,542,464 by 2028, as per the UBS Global Wealth Report. The decision to phase out the “non-dom” status, which exempted wealthy foreign residents from paying British taxes on overseas income, is expected to prompt many individuals to relinquish their U.K. residencies. Despite having the third-highest millionaire population globally, the U.K. faces challenges in retaining high-net worth individuals due to changing tax policies and regulations.
The United Arab Emirates has emerged as a magnet for millionaires seeking favorable tax conditions, security, and a high quality of life. With a robust wealth management ecosystem and attractive incentives, the UAE continues to be a top choice for high-net worth individuals looking to relocate and establish roots in a thriving financial hub like Dubai. The contrasting fortunes of the U.K. underscore the importance of creating an environment that is conducive to wealth creation and retention in an increasingly competitive global landscape.
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