Why do we allow bonuses at all?

People should be paid a fair days’s pay for a fair day’s work. Bonuses are simply a way to avoid income tax.

I think *all* bonuses should be taxed at the high rate of tax. And I think that benefits like share options and the ludicrously large pension contributions that the corps give their execs should be taxed at high rate too. We need transparency in what these people earn.

“Bonuses are simply a way to avoid income tax.”

Eh?

Why do we allow bonuses at all?

Because private employment contracts are none of your business.

… Bonuses are simply a way to avoid income tax.

Um no, the taxman counts them as income.

Just read the full letter. When even the cheerleaders of capitalism at the Economist are calling for a higher rate of tax for the hyper-rich (point 2 of the Communist Manifesto’s 10-point programme, IIRC) you do have to wonder what the Tories are playing at.

What is the point of increasing corporation tax on banks that are publicly owned?

No mention of separating out casino banking from retail banking then. Plus ca change, it’s just window dressing.

“Clueless Chuka” utterly demolished here

http://www.spectator.co.uk/coffeehouse/6150868/clueless-chuka.thtml

One would have to be pretty clueless for Fraser Nelson to demolish. Although he is right on the Robin Hood he did not address most of points. Distributing who pays is the point. You can’t demonstrate progressivity using percentages of income alone. Why are those in the bottom deciles paying anything at all to deal with the governments fiscal problems? Income for those in the bottom deciles has a greater marginal utility than those further up the deciles where it has a diminishing marginal utility. A 5% loss of income for those in the bottom decile represents a greater loss of utility than a 5% loss of income for those in the top decile. Therefore, no budget where those in the bottom deciles lose income can ever be progressive.

@Mr S. Pill
The economist are left leaning.

@9

Ermmm… under what definition, exactly??

“Clueless Chuka” utterly demolished here

I’m absolutely shocked that Fraser Nelson is making right-wing arguments. What next? Bear shits in the woods? Our priorities are different – he’s not concerned on whether it’s a progressive budget or not.

Sunny Hundal @ 11

No, it’s not Fraser Nelson’s arguments that are surprising; it’s Chuka Umanna’s complete ignorance of the National Insurance rises and his poor judgment on transaction taxes.

Why are those in the bottom deciles paying anything at all to deal with the governments fiscal problems?

To serve them right for electing a Labour government in 2005 most probably. It’s called ‘taking responsibility’ for the consequences of their actions.

What kind of idiot thinks NIC is progressive? There is an upper threshold above which you do not pay employees’ NIC. Anyway, the wealthy and clever can avoid even this by receiving income as dividends.

If this is the extent of tax knowledge on the left we are all doomed.

And Richard Blogger, learn something about tax before talking about it. As ukiberty says they are taxed like salaries. There is no difference. Unless we are talking about more complex schemes involving foreign trusts etc.

If you want somethng progressive, go for an investment income surcharge to match the NIC cost on earned income. The Labour party spent the last 13 years convinced that workers’ earnings should be taxed more heavily than capitalists investment returns and capital gains. No-one from the Labour Party has any business lecturing anyone about progressive taxes.