Why some of London's top chefs are opening Gulf outposts: low taxes, no unions, and a 'tax tsunami' at home

James Robson was in Hong Kong this week, scouting for opportunities in Asia, when he explained why one of London's most talked-about restaurants is looking abroad. Robson co-owns Fallow in St James's Market, regarded as the capital's hottest restaurant, serving 1,000 people a day. He has just signed a deal to open an outpost in the Gulf.

Fallow is not alone. Scott's in Mayfair, a celebrity hotspot, has opened in Dubai, as has Gymkhana, the two Michelin-starred Indian restaurant, and the upmarket Chinese venue Park Chinois. Bread Ahead, the Borough Market bakery, has also branched out in Dubai. In Abu Dhabi, Isabel's, a Mayfair institution favoured by politicians, has opened its doors.

Fallow's fame owes something to Instagram, where it has 650,000 followers, and to dishes such as a whole cod's head drenched in a spicy butter sauce. Robson names three regions as key growth targets: east Asia, the United States and the Gulf. In his words, America champions business, the Gulf actively encourages and assists it, and east Asia has a work ethic and taxation system that puts the UK to shame. He says he is keen to start working in these regions over the next few years.

His explanation for the pull of overseas is a "tsunami of taxes" at home. He says it has reached the point where taking business risk makes no sense in the UK, and that the country has sleepwalked into anti-growth taxation in the last two budgets, with more likely next week. He points to the 20% rate of VAT on hospitality, one of the highest in Europe. The European average for restaurants is about 12%, and Italy charges 10% on restaurant food. Chefs are calling on Andy Burnham to cut the rate in next week's budget. Robson wants VAT brought more in line with Europe, and adds 25% corporation tax and a dividend tax of 40% or more to the calculation: at that point, he says, you start to question why you do business at all.

Jason Atherton, a Michelin-starred chef, now spends a third of his time at his Dubai restaurant and says it is easier to make a profit there than in London.

Robson insists he does not resent paying UK tax. He says he is proud of what he pays and feels privileged to contribute to the country's deficit, and will keep doing so. His argument is that UK growth no longer offers a workable balance of risk and reward, so the safe course is to play carefully at home and focus overseas.

Human rights groups see the Gulf differently. Felix Jakens, Amnesty International UK's director of campaigns, says the UAE has a very poor record on workers' rights and protection from labour exploitation, and that it has spent heavily on polishing its image in Britain, not least through Manchester City. Migrant workers, he notes, make up the majority of the UAE's population and remain bound by a sponsorship system that ties them to their employers and exposes them to abuse. They are denied the right to form trade unions. Jakens says any UK business expanding there must carry out proper human rights due diligence, so that kitchen staff are treated fairly, paid properly and able to raise concerns without fear of losing their job or visa.

The commercial picture is also mixed. The US-Israeli war in Iran earlier this year brought bombardment to Dubai and an exodus of expats, yet restaurants keep opening. Some are struggling: Dinner by Heston has been temporarily closed since the fallout from the war. Earlier this month the Michelin guide was criticised for including 16 restaurants in Dubai that were permanently or temporarily closed, apparently because some inspections took place at the start of the year, before the war began.

Next week's budget will show whether the chefs' VAT plea is heard, and whether the Gulf pull strengthens or fades.