Majority of U.K. Bank Bonuses to Go to Tax Authorities

[dipsydoodle]

Source: Bloomberg

Britain’s tax authorities will for the first time take a greater proportion of financial services bonus payments than the workers who earned the rewards, according to the Centre for Economics & Business Research Ltd.

About 4.1 billion pounds ($6.5 billion) of the estimated 7 billion-pound bonus in the pot for 2010 will go to Her Majesty’s Revenue & Customs, the research company said in a statement today.

“The public coffers stand to gain considerably more from City bonuses than City workers themselves,” said Benjamin Williamson, a London-based economist and co-author of the findings, referring to London’s main financial district. “A whopping 7 billion-pound bonus payout will be easier to stomach if the lion’s share goes to the nation.”

In April, the U.K. introduced a new 50 percent tax band for those earning more than 150,000 pounds. Chancellor of the Exchequer George Osborne yesterday said he will block the payment of large bonuses unless banks show they are extending credit to households and companies.

Read more: http://www.bloomberg.com/news/2010-10-04/majority-of-u-k-bank-bonuses-go-to-tax-authorities-cebr-says.html

[Turbineguy]

1. "the workers who earned the rewards"

This must be a new definition of the concept "earn".