Harry Stebbings, a prominent tech investor and podcaster, has warned that a significant increase in capital gains tax (CGT) in the upcoming UK budget would trigger a mass exodus of tech entrepreneurs from the country. Stebbings, who recently raised a $400m fund for his firm 20VC, told the Guardian that the UK is “a bad place to do business” due to its tax environment.
Chancellor Rachel Reeves is reportedly considering raising CGT to between 33% and 39% in the budget on 30 October, according to the Guardian. Stebbings said this would be a major deterrent for entrepreneurs, asking, “Why would you look to invest in the UK if you’re looking at a 35% CGT rate?” He added that he knows “fewer entrepreneurs will be here. They will leave en masse.”
However, a group of millionaire business owners has urged Reeves to raise £14bn through a CGT increase, arguing it would not scare away real investors. Prime Minister Keir Starmer has indicated the rate will not reach 39%, calling that figure “wide of the mark.” Currently, higher-rate taxpayers pay 24% CGT on residential property and 20% on shares and other assets.
Stebbings, whose 20VC fund is backed by MIT and OpenAI investor Josh Kushner, acknowledged the UK’s potential in tech, citing successes like Revolut and Google DeepMind. He said he will remain based in the UK, but stressed the tax situation is “fixable” and urged policymakers to consider the impact on the tech sector.
