Tax Exiles


In 1973, Pink Floyd released The Dark Side of the Moon which included the single ‘Money,’ on which Roger Waters snarled: 


Get back

I’m alright, Jack, keep your hands off of my stack

‘Money,’ according to one critic, “deals with crass materialism.” But by the time Pink Floyd recorded The Wall in 1979, they did so in France and the United States because remaining in Britain would have incurred a massive tax bill. 

British income taxes post-1945

Hiked to 99.25% during World War Two, Britain’s top rate of income tax did not return to its pre-war level when the war ended, hovering around 90% through the 1950s and 60s. These rates were a bane of Britain’s entertainment industry. In ‘Taxman,’ released in 1966, The Beatles sang:

Let me tell you how it will be
There’s one for you, nineteen for me
‘Cause I’m the taxman
Yeah, I’m the taxman  

“‘Taxman’ was when I first realized that even though we had started earning money, we were actually giving most of it away in taxes,” George Harrison wrote in 1980. “It was and is still typical.”

The 1970s: The Age of the ‘Tax Exile’ 

In 1971, a Conservative government cut the top rate of tax on ‘earned’ income to 75% but a 15% surcharge on ‘unearned’ investment income kept the top rate at 90%. 

The Rolling Stones had had enough and went to France to record Exile on Main Street. “[I]n those days, in England, the high tax rate was 90 percent,” Mick Jagger explained:

You made 100 pounds, they took 90. So it was very difficult to pay any debts back. So when we left the country, we would get more than the 10 pounds out of 100. You know, we might get 50 or something.

In 1974, a Labour government hiked the top rate on ‘earned’ income to 83% for a top rate of 98%, the highest permanent rate since the war. 

Rod Stewart fumed:

The Government thinks it’ll tax us bastards right up to the hilt because we won’t leave, but that’s wrong because I will if I want to…with a 90 percent tax ceiling, it’s just not worth living in England any more.


He left for California in 1975 – his first subsequent LP was titled Atlantic Crossinginfuriating Elton John. “Round at his place one evening,” Stewart wrote in his autobiography: 

I told him I was thinking of quitting Britain, and he called me a traitor and put on Elgar’s “Pomp and Circumstance Marches” at a volume so high that we couldn’t talk over it.

The Stones and Stewart became known as ‘Tax Exiles.’ They were joined by others. Jethro Tull went to France, Marc Bolan to Switzerland, Tom Jones and Bad Company to California – lead singer Mick Ralphs citing “ridiculously high tax in England” – Ringo Starr to Monte Carlo, and Cat Stevens to Brazil. In 1978’s ‘Dead End Job,’ Sting sang “I don’t wanna be no tax exile.” He moved to Ireland in 1980 where musician’s royalty earnings were exempted from income tax.

If, in many cases, exile marked a vertiginous decline in the quality of the exile’s music, this wasn’t so in every case. David Bowie went to Switzerland where, according to his wife, Angie, he got “an almost ludicrously low tax rate of about 10 percent.” “The Swiss take their residency requirements seriously,” she wrote:

…and demand that their resident foreigners spend significant amounts of time at ‘home.’ Therefore you ‘stay’ or ‘work’ or ‘holiday’ in your London flat, Berlin garret, or wherever, and return to Switzerland when you have to.

This led Bowie to Berlin where he recorded his classic trilogy of albums – Low, Heroes and Lodgerbetween 1977 and 1979. 

The 1980s: The end of the Tax Exiles

In 1980, Margaret Thatcher’s Conservatives cut the top rate of income tax to 60% and reduced it to 40% in 1988. The investment surcharge was abolished in 1985 and the era of the Tax Exile ended. 

A recent paper by economists Henrik Kleven, Camille Landais, Mathilde Muñoz, and Stefanie Stantcheva that: “review[s] a growing empirical literature on the effects of personal taxation on the geographic mobility of people and discuss[es] its policy implications” found that:

There is growing evidence that taxes can affect the geographic location of people both within and across countries. This migration channel creates another efficiency cost of taxation with which policymakers need to contend when setting tax policy.

More specifically:

This body of work has shown that certain segments of the labor market, especially high-income workers and professions with little location-specific human capital, may be quite responsive to taxes in their location decisions.

The era of the Tax Exiles illustrates that perfectly. “We left England because we’d be paying 98 cents on the dollar,” Rolling Stone Keith Richards explained, “We left, and they lost out. No taxes at all.”




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Money In 1973, Pink Floyd released The Dark Side of the Moon which included the single ‘Money,’ on which Roger Waters snarled:  Money Get back I'm alright, Jack, keep your hands off of my stack ‘Money,’ according to one critic, “deals with crass materialism.” But by the time Pink Floyd...

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