TaxCorporate TaxBank bonus tax could boost Treasury coffers by £3bn

Bank bonus tax could boost Treasury coffers by £3bn

Government estimates Darling’s one-off tax could exceed expectations, despite “restraint” by City banks

The chancellor’s one-off tax on bank bonuses could bring in as much as £3bn
to the government purse, the Guardian has reported.

Alastair Darling originally estimated that the 50% tax levied on bank bonuses
over £25,000 would raise £550m, but reports of payouts by the City’s leading
institutions has led the Treasury to increase their estimates amid claims from
the City that they have been “showing restraint” with their annual bonuses.

The original forecast had taken changes in banks’ behaviour into account, but
it has since emerged that some employers still expect to pay “hundreds of
thousands” in the tax this year, even with bonuses capped or cut.

Goldman Sachs are capping partners’ pay at £1m for both bonus and salary,
while Credit Suisse has ordered London directors bonuses to be cut by 30%.
Barclays, RBS and HSBC have yet to report their forecasts to the Treasury.

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