Icelandic billionaire Thor Björgólfsson quits UK for Italy, warns of wealthy exodus over tax changes

Emma Taggart Sat, July 18, 2026 at 9:30 AM PDT | 4 min read

An Icelandic billionaire has become the latest wealthy business leader to quit Britain since Labour came to power.

Thor Björgólfsson, an investor known as Iceland's first billionaire, has changed his tax residency from the UK to Italy over the last year and moved his investment firm Novator from London to Zurich.

His relocation comes amid growing concerns that many high-net-worth individuals are fleeing Britain, fuelled by Labour's decision to abolish non-dom status and tighten inheritance tax rules.

In an interview with Bloomberg, he warned that the number of wealthy entrepreneurs leaving Britain "is an exodus, it's not been hype".

Mr Björgólfsson said the scrapping of the non-dom regime, which ended some wealthy individuals' right to avoid full UK tax on their overseas earnings, had pushed investors overseas.

He said: "It's amazing how fast it has happened. The collateral damage is exploding elsewhere."

Policy changes and fallout

Rachel Reeves, the Chancellor, replaced the non-dom rules in April 2025 with the Foreign Income and Gains Regime, under which eligible new arrivals receive a four-year tax exemption on their foreign earnings, provided they were not a UK resident during the previous decade.

Mr Björgólfsson's move to Milan means he joins a growing list of business leaders who have quit Britain since Labour came to power and scrapped the non-dom regime. Several high-profile business people have left the UK for tax purposes, including Richard Gnodde, a Goldman Sachs banker, and John Reece, the finance chief of chemicals giant Ineos.

Speaking about a meeting he had with an advisor to Sir Keir Starmer, alongside other high-net-worth individuals, Mr Björgólfsson said: "What worries me is that the Government kind of made a mistake and realised they'd made a mistake."

He called on Labour to implement a flat-rate tax system, similar to Italy, which caps the amount of tax owed to attract entrepreneurs and business leaders.

Personal background

Mr Björgólfsson's relocation to Milan comes as the billionaire investor has made a dramatic recovery since the 2008-09 global financial crisis, when he lost almost all of his fortune.

At the time, Mr Björgólfsson was the biggest owner of Landsbanki, one of Iceland's largest banks, which collapsed in 2008. He was criticised for his role in the bank's collapse and later issued an apology for his actions in the run-up to the financial crisis.

Inheritance tax concerns

In Ms Reeves's first Budget, she also announced that wealthy foreigners' overseas assets would become liable for inheritance tax in Britain.

However, a year later, she attempted to undo some of the damage from this policy by introducing a £5m cap per decade on how much inheritance tax can be levied on former non-doms.

Mr Björgólfsson warned the measure was "a little too late when people have bought places abroad".

Impact on London's financial sector

There are concerns that London's financial services sector is losing out as business leaders quit Britain. The relocation of Novator, Mr Björgólfsson's investment firm, to Zurich is reported to have caused 20 job losses in London.

Political context

Mr Björgólfsson's warning that Labour is driving high-net-worth individuals and entrepreneurs out of Britain comes as Andy Burnham enters No 10 on Monday.

There are fresh concerns among wealthy investors that they will be first in the firing line for a new Labour tax raid under a Burnham administration. There are fears that the incoming prime minister could increase the rate of capital gains tax (CGT) to bring it into line with income tax.

Louise Haigh, the former transport secretary and a close ally of Mr Burnham, wrote an essay in May in which she argued that "CGT should be brought closer to income tax rates".

CGT is currently charged at 18% for basic-rate income taxpayers and 24% for higher-rate taxpayers.

Government response

A Treasury spokesman said: "If you make your home in Britain, then you should pay your taxes here too. That is why we..."