BANKERS MAY have delayed their bonuses this year in order to take advantage of the drop in the income tax rate to 45p from 50p, according to Labour.
Revised figures from the Office for National Statistics show bonuses in financial and business services soared in April this year by 82% compared to the year before, something the opposition party claimed shows a deliberate move to take advantage of the fall in the tax rate, the Telegraph reports.
It added that people on average are £1,350 worse off under the coalition as a result of wages failing to keep apace with inflation.
Labour’s shadow Treasury minister Catherine McKinnell accused the chancellor of presiding over “three years of economic failure”.
She said: “Bonuses soared to almost £4bn in April as bankers delayed their payouts to take advantage of George Osborne’s top rate tax cut.
“And millions of pounds of tax revenues will have been lost as a result. This may feel like a recovery for those at the top, but for everyone else life is getting harder.”
Goldman Sachs had been at the centre of controversy in January over the timing of its bonuses, eventually bowing to public pressure to pay before the April deadline, when the tax rate dropped.
Goldman took similar steps in the US when it paid out bonuses to its ten top executives on New Year’s Eve, hours before Congress voted to raise taxes on America’s wealthiest as the ‘fiscal cliff’ deadline approached.
Yet, KPMG’s annual survey shows that the UK is still an attractive place to do business, despite falling in rankings in tax competitiveness and FDI appeal
Following recent issues with HMRC’s personal tax computation software, Brian Palmer of the AAT questions whether the government’s implementation timeframe for Making Tax Digital is realistic
MTD cost estimates are not based on 'facts', and are 'disbelieved' by most small businesses and sole traders, says Lords committee chairman
The first phase of a process to restrict the amount of tax relief for residential landlords to the basic rate of tax will enter into force on April 6