(Bloomberg) — One of Britain’s richest finance billionaires has called for the UK government to scrap its tax on share trading as a way to boost the country’s stock market after years of stagnating growth.
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“I’ve always found it laughable that we are the only major stock market that still has stamp duty,” ICAP founder Michael Spencer said Friday on the Merryn Talks Money podcast. “If you are not prepared to abolish that duty, then stop pretending that you’re in favor of the London market.”
Spencer, 69, joins UK banking giant Barclays Plc and brokerage firm Peel Hunt in calling for the UK to do away with its stamp duty reserve tax, a 0.5% levy for share purchases on the main London Stock Exchange that was abolished for the junior Alternative Investment Market in 2014.
Once Europe’s top venue by volume, the UK saw the amount of capital raised through initial public offerings last year decline about 9% to $1 billion, falling behind emerging markets like Malaysia and Oman. The drop was partly due to increasing competition from other global financial centers such as Amsterdam.
“Lots of companies are now moving their listing from the UK to elsewhere,” Spencer said in the interview. “This slow corrosion — it really is sad to see.”
Earlier this year, London-based luxury logistics company Ferrari Group Plc chose the Dutch capital for its stock listing in a further blow to the UK’s financial markets. Swedish fintech giant Klarna plans to go public in New York this year, despite previously establishing a UK holding company as part of its listing preparations.
The UK tax authority received £3.2 billion ($4.1 billion) through share-purchase levies for the financial year ended March 2024, a decline of 13.5% from 12 months earlier, latest accounts show.
Spencer founded ICAP in 1986 and built it into one of the world’s biggest broker-dealers, putting him among the City of London’s most prominent figures. It later became NEX Group, which Spencer sold to CME Group Inc. in a 2018 deal that valued the UK firm at £3.9 billion.
He’s also a major Conservative Party donor and previously served as its treasurer. Still, he offered the party little support over its lack of action over stamp duty in the run-up to Keir Starmer’s Labour Party victory in July.
