Labour should simply announce an emergency cap on top pay. Anything over the prime minister\’s £200,000 should be temporarily taxed at 90%. No bonuses, no fiddles. The golden geese will fly away to Dubai, Mumbai, Shanghai? Unlikely, but if a few go, who cares?
Well, it depends upon how many do go.
The money should be hypothecated for an emergency national job-creation plan
For if any significant portion do go then there won\’t be any extra money.
That\’s leaving aside the Laffer Curve effects of such taxation on future efforts. Tax rates of 90% do indeed depress economic activity and thus the tax that can be raised from such.
Not at all: near-bust UBS cut top pay but finds other banks picking off their top people. That\’s why government has to call time on pay for all, to end the greed game where every silverback demands to be in the top quartile.
But such top people are indeed in an international market. They can bugger off very easily indeed.
As an aside, worth noting that these punishing tax rates are coming in just above Polly\’s gossiped about salary level….but well below those of her bosses at The Guardian and the GMG.
"Hey Boss, you should pay 90% tax but I shouldn\’t" will make for interesting water cooler talk.
This does very much amuse me though.
But "Eat the Bankers" signs do not portend a spit-roasting in Canary Wharf:
I don\’t think that Polly knows what "spit roasting" means in today\’s parlance.
At least I hope not.