London Restaurateurs Expand to Gulf Amid UK Tax Concerns
Top London restaurant owners are opening outposts in Dubai and Abu Dhabi to escape high UK taxes and seek better profitability in the Gulf.
Leading London restaurateurs are shifting their growth strategies toward the Gulf states, specifically Dubai and Abu Dhabi, citing a poor risk-reward balance in the United Kingdom. James Robson, co-owner of Fallow, recently signed a deal to open a Gulf outpost, joining other established venues including Scott’s, Gymkhana, Park Chinois, and Bread Ahead. Additionally, the Mayfair institution Isabel's has opened a branch in Abu Dhabi.
Business owners argue that the UK's 20% VAT rate for hospitality, coupled with corporation and dividend taxes, has created a tax environment that makes domestic expansion unsustainable. Michelin-starred chef Jason Atherton, who operates a restaurant in Dubai, reports higher profitability abroad than in London. While some venues, such as Dinner by Heston, have faced temporary closures due to regional conflict, the general trend remains focused on the supportive business environments of the Gulf and East Asia.
Amnesty International UK has cautioned businesses expanding into the United Arab Emirates to conduct human rights due diligence. The organization warns that companies risk complicity in labor exploitation and the restrictive sponsorship system that affects the majority of the UAE's migrant workforce.
