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Tuesday 08th of December 2009
December 6, 2009    

Plans for windfall tax on bankers’ bonuses

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by Kay Murchie
Plans for windfall tax on bankers’ bonuses

In the Pre-Budget Report this week, Chancellor Alistair Darling is expected to announce a windfall tax on British banks.

The measure is one of many being planned by Mr Darling to target high earners. Other measures include increasing the number of people liable to pay inheritance tax, as well as an increase in capital gains tax.

While the speculation will not be welcomed by the City, taxpayers who have been outraged at the sheer size of bonus payments will no doubt welcome the news.

The news comes as The Sunday Times has today reported that over 1,000 investment bankers have left the Royal Bank of Scotland (RBS) after a heated row with the Treasury over bonuses.

Bonuses have been a major topic of conversation this year and for RBS, in particular, after Sir Fred Goodwin (former chief executive of RBS) bowed to public pressure and agreed to hand over £4.7 million of his much-talked about £17 million pension.

Meanwhile, the Chancellor is also expected to admit at this week’s Pre-Budget Report that the annual budget deficit will now exceed £175 billion - primarily due to falling tax receipts as a result of the recession.

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