British companies deferred bonuses worth £1.7bn until April this year so that staff would not have to pay the 50p top rate of income tax, the Office for National Statistics’ annual bonus survey has revealed.
The 45p rate came into force in April 2013. This means that if the £1.7bn had been paid to staff before the 50p top rate was scrapped, the Treasury would have earned an extra £85m.
The total bonus payments across the whole economy during the financial year April 2012 to March 2013 were £36.9bn, an increase of 1% compared with the same period in 2011/12. This equates to an average of around £1,400 per employee.
However, bonuses paid in the year to April were 4% higher at £38.6bn because of the deferrals.
The financial and insurance industry took the top spot in bonus payments, with £13.3bn paid out in to them in totalthe last financial year.
Oil and gas workers came in second, receiving average bonus of £6,700 – a £200 drop on last year. Total bonuses to non-financial firms rose 1% to £23.6bn, almost as high as the 2007/08 peak of £24bn.
Speaking about the figures, Simon Chouffot, a spokesman for the Robin Hood Tax campaign, told the Telegraph: “It’s outrageous that during one of the most scandal-ridden periods in the history of banking, City bonuses still far outstrip those in the rest of the economy.
“But bonuses are only part of the story – City salaries are accelerating at break-neck speed to stay ahead of regulation and ensure the privileged few still receive their lottery-sized pay packets.”
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