The recent drop in Capital Gains Tax (CGT) revenue will have made the government think hard about its relationship with wealthy foreign investors.

The figure fell to £13 billion from £14.5 billion in the year to March 2025, with headlines citing the government’s decision to scrap non dom rules as one cause.

“The move to end the non-dom tax regime could reduce the number of wealthy non-doms in the UK and hence reduce future CGT receipts,” Robert Salter, director at tax advisory firm Blick Rothenberg, told The Times.

When headroom is already tight to the point of unnerving financial markets, £1.5 billion looks like a meaningful sum of money. That’s before the obvious question arises of which other taxes could be affected.

The Office for Budget Responsibility (OBR) warned in March that the government’s £9.9 billion of headroom was  “a very small margin compared to the risks and uncertainty inherent in any fiscal forecast.”

Speculation will inevitably grow this year about which taxes the Chancellor may raise at the autumn Budget to rebuild a buffer that is a third of its pre-Covid average.

Despite the predicament, recent turbulence on financial markets means the UK is well-placed to capitalise on its position as a stable place to invest. 

And the end of the non dom regime does not signal the end of the conversation about how to attract private overseas investors.

The reported exodus of wealth from the UK has given rise to the term “Exit” in the media, which the Treasury won’t want to catch on.

“We are still talking,” a spokesman for lobby group Foreign Investors for Britain (FIFB) told Knight Frank. “Tax revenues and OBR forecasts are important considerations for the government.”

The FIFB has been pushing for a so-called tiered tax regime, where foreign investors pay an annual sum depending on their level of wealth, with a figure of £2m per year for those in the upper bracket

As the financial pressure intensifies on the government, which keeps borrowing costs higher for everyone, could it introduce a new measure with a politically-palatable name like a ‘UK investor visa’?

Donald Trump recently unveiled plans for a “gold card” visa in the US, which will cost US$5 million. Elsewhere, the global landscape is a mix of countries winding schemes down as others ramp them up.

Any form of Wealth Tax in the autumn Budget would surely be a tougher sell against the background of falling tax revenues and a so-called “Wexit”?

Tom Bill is head of UK residential research at Knight Frank