Oaknorth co-founder and chief executive Rishi Khosla was among chiefs to back the call to ditch stamp duty by the Unicorn Council for Fintech, convened by industry body Innovate Finance.
If there was ever a sign of the damage being done by the government’s stamp duty on share trading, it came today in the form of a bruising bolt from the UK’s top fintech firms.
The clamour over stamp duty is nothing new in City circles. Scores of firms and industry groups have been taking aim at the charge on share trading in recent months with warnings it is penalising UK investors and choking off capital when the market needs it most.
In Germany, Spain and the US, no charge of this scale is placed on shares. If UK investors want to buy Tesla or Meta, they can do so levy free.
The troubles of the London Stock Exchange are well covered and the government should be doing everything within its power to woo firms like Revolut and Monzo onto the market. As industry group TheCityUK put it earlier this year, Jeremy Hunt and the gang should be rolling out the red carpet.
In its defence, the Treasury claims that the tax is a revenue raiser that doesn’t damage “the ability of businesses to access capital” or impede” London’s position as a global centre for listing companies”. But that claim is looking flimsy at best. What’s clear in the warnings from the UK’s top fintechs today is that the charge is doing just that.
Amid the great push for capital markets reform from ministers and regulators, the charge has long looked an outlier. Ministers and regulators have taken on tweaks to areas like listing rules and investment research with some enthusiasm but remain steadfast in their backing of the tax.
It is by no means a panacea given the troubles London finds itself in, but the message from the UK’s top prospects is now clear: ditch stamp duty to boost the appeal of the market.
To lose the likes of Revolut, Monzo and Zilch overseas would be a hammer blow for an already bruised London Stock Exchange. Ministers have a window to act before another group of homegrown firms take flight across the Atlantic.
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