UK Dumps Plan to Tax Sovereign Wealth Funds

Posted on 03/17/2023

U.K. Finance Minister Jeremy Hunt dumped a plan to tax sovereign wealth funds investing in the United Kingdom, according to a government document. The government document detailed the measures in a budget plan announced by Hunt on March 15, 2023. The report said, “the government has carefully considered” responses to its consultation on the immunity of sovereign funds from direct taxation.

“It has decided that there will be no change to the current exemption, and that it will continue to operate as it does now,” the document.

Sovereign wealth funds are major investors in the U.K., according to SWFI data and they’ve continued to invest in the country post-BREXIT. SWFs and large foreign pension investors could exit projects in Britain if such a law were passed. Both Asian and Gulf-based sovereign wealth funds are major investors in real assets in Britain including real estate, renewable energy projects, and infrastructure.

On October 14, 2022, Jeremy Hunt was appointed Chancellor of the Exchequer by Liz Truss, following the dismissal of Kwasi Kwarteng, and retained his role as chancellor in Rishi Sunak’s ministry following Truss’ resignation.

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