Bankers ‘Let Down’ as Tax Makes London Most Expensive

[NeoConsSuck]

Source: Bloomberg

Jan. 14 (Bloomberg) -- The U.K. government’s decision to raise the top rate of income tax will leave residents earning more than 1 million pounds ($1.6 million) a year worse off than they would be in any of the world’s other major financial centers.

“People feel let down,” Nick Bacon, a London-based financial services tax partner at accounting firm KPMG, said in a telephone interview. “They thought that the U.K. could always be relied on as being tax-friendly.”

The U.K. government will raise the top rate of income tax to 50 percent in April, making London more expensive for residents earning 1 million pounds a year than New York or Hong Kong, according to KPMG estimates. A London banker on that amount will pay 491,278 pounds in income tax and social security payments from April, three times more than in Hong Kong and 58,500 pounds more than in New York, the data show.

Prime Minister Gordon Brown, facing an election by June, pledged last year to make the finance industry “the servant of people and industry, and not their master” after bailing out banks with more than 1 trillion pounds of taxpayers’ money. London firms such as Tullett Prebon Plc, which acts as a go- between between banks trading securities, and hedge fund operator BlueCrest Capital Management Ltd. said they may move some operations overseas to avoid the tax increases.

<snip>
“I’m sure the seven and half million other Londoners will be overflowing with sympathy,” said Brendan Barber, general secretary of the Trades Union Congress, whose members fund two- thirds of the annual budget of Brown’s Labour Party. “The recession that cost many Londoners their jobs was caused in the finance sector. It is only right that London’s super-rich now make a fair contribution to putting right the damage.”


Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=axhnd2zRRDrc&pos=1

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When growing up, I was force fed throughout school that the USA was the greatest country in the world. My, what BS propaganda that was. In the USA, we hold congressional dog & pony shows to feign umbrage at the financial industry.

[dipsydoodle]

1. Yes - life's a bitch............

:sarcasm:

[FreakinDJ]

2. Go ahead move them overseas

that way those countries can pay to bail them out

[proudohioan]

3. WAAAHHHH!!!!

:nopity:

[Dr.Phool]

4. They're lucky they still have their heads.

They'd bitch if you hung them with a brand new rope.

[Turbineguy]

5. I imagine

a lot of French aristocrats felt let down. Just before they got the chop.

[keopeli]

6. Sure, move to communist China. Or, why not Russia, or even Dubai.

So you have to put up with a few strange social laws, like women being segregated from men, or email being tapped by the government and you can't even get Google, or bank security being run by the mafia. But, go ahead, find another place that's cheaper for you rich snakes to live.

[aquart]

8. Dubai? Does the sewage still stink on the beaches?

[aquart]

7. Oh, poor dears. "Assume a virtue if you have it not."

[rpannier]

9. I'll take one of those jobs

I'll gladly pay the tax and I bet I can do a better job at not making a mess than they did

[McCamy Taylor]

10. "They thought the UK could always be counted upon to be tax friendly....."

Dudes, Thatcher has been gone a long time.

[Nihil]

12. Not that you'd notice until pretty recently though ...

... and it's only after a *lot* of kicking that Brown finally
accepted that he couldn't dodge any longer ...

[Roland99]

11. So, someone making $1.6 million/yr (US) will pay $80,000 more in taxes?

The poor dears.

[PaulaFarrell]

13. That first paragrah (and title) are misleading

it will affect anyone on £150,000 or more per year - not just bankers and not just people earning more than a million. I think the level should be slightly higher, myself, say £250,000+

[muriel_volestrangler]

15. Just because the 50% rate kicks in at £150,000, doesn't mean they're worse off than in elsewhere

It says those with income over £1m will be "worse off than they would be in any of the world’s other major financial centers." The centres are Frankfurt, Hong Kong, Mumbai, New York, Paris, Singapore, Tokyo, Zurich, and Hong Kong (at the bottom of the Bloomberg article). Those at lower incomes (eg £200,000) may well be taxed more in France or Germany, for instance. The article is about KPMG trying to persuade rich bankers that it's worth taking KPMG's advice on where to go to pay as little tax as possible.

Meh - how often does KPMG whinge about the effective marginal rate of someone getting tax credit being 70% (20% income tax + 39% tax credit withdrawal rate + 11% national insurance)? The 51% (50% income tax + 1% NI) that someone at the new top rate will pay still looks pretty light to me.

[Veruca Salt]

14. I am SO jealous!!

When can we do the same? Bring back the 90% tax rates of the 1950s!