Polly love, please, do try to think occasionally

Barclays, HSBC, RBS and Lloyds are paying themselves £5.5bn in bonuses this year. How much is that? About a penny and a half off the income tax,


Those bonuses will be taxed at 45 p in the £, plus a couple of percent employees’ national insurance plus near 14% employers’ national insurance. Call it 55% or so all round.

If that cash were not paid out as bonuses it would, assuming it stayed in the banks themselves, be taxed at 26% corporation tax. We thus get, roughly speaking, 30% of the total sum as tax as a result of it being paid as bonuses. So, again roughly, precisely and exactly because this wonga is paid out as bonuses income tax rates for the rest of us are half a penny lower.

18 thoughts on “Polly love, please, do try to think occasionally”

  1. So Much for Subtlety

    I think Polly would regard a 45 percent or a 90 percent or even a 105 percent corporate tax rate as a victory.

    So don’t give her ideas.

    In the meantime, and in the spirit of everything I think about Polly believes, I wish everyone here a happy Steak and Blowjob Day. Not yet an official holiday but perhaps Obama will do one good thing before he leaves office.

  2. If not paid as a bonus but retained in taxable profit should you not also consider possible increase in dividend and so income tax on that?

  3. You could think about it that way. But income tax on dividends is deliberately about the same, once you adjust for corporation tax paid etc, as that on PAYE earnings. And it’s without NI. So you still get more tax if it’s paid out as a bonus rather than a dividend.

  4. “Barclays, HSBC, RBS and Lloyds are paying themselves… in bonuses this year”

    Now that’s the basis of aninteresting debate. Not that Polly realises of course.

  5. Bankers’ bonuses. Boo! Boo!
    It’s remarkable how the narrative prospers.
    I’ve been having a lengthy e-mail argument over the supposed iniquities of the banks. The “bankers’ bonuses” was one my correspondent trotted out. My reply was; that’s the banks’ business & none of yours. Do you want them demanding a say in your remunerations?
    He’s sole proprietor of a sizeable property development concern. FFS!

  6. BinS

    Property schmoperty. Try Russell brand for size: Extremely rich comedian condemns “disgusting” amounts earned by people who earn much less than him.

  7. @ironman
    But I’d expect hippocracy from the Russel Brands of the world. It’s his well paid stock in trade. As it is Polly Pot’s.
    But property development is an industry grazes off the artificial scarcity of housing & preferential access to credit. You don’t need property developers to build houses. Just builders.
    You’d think he’d keep quiet..

  8. Thank’s Rob.
    You try coping with a spell checker can’t make up its mind between four languages & two versions of english, depending on which webpages are open.

  9. I hate the “are paying themselves”, as if they are just creaming it off our deposits.

    Related to your point, she actually means “are being paid by the owners of the banks from the profits they made investing their capital to provide us with banking services”

    80% less pithy, 95% less class warry, about 200% more true.

  10. There’s nothing to stop Polly and her mates opening their own bank and doing it for nothing* – just as there’s nothing to stop her refusing to take a six figure salary, or flogging one of her homes off to help poor people.

    *Oops there is – fucking government regulation and other barriers to entry. If only the government would listen to Polly and scrap all the bureaucracy to make it easier.

  11. @ Ironman, BiS

    My brother is in a position of some influence vis a vis the Tory Party and even he spouts this bullshit. Mind you, he is a dickhead, and it is the Tory party so…

  12. @interested
    The incredible thing’s the guy’s active in UKIP. Has been encouraged to consider standing for election. The discussion consisted of quoting UKIP policy & simple economics in response to tabloid column headings & TV soundbites. If i can’t convince him of his own party’s intellectual base, what hope is there?
    Typical exchange.
    “SME’s create more jobs in the economy. They should be supported”
    “No they don’t. They destroy jobs. That’s the point of them. Doing things more efficiently. Providing less jobs. Creative destruction. If you said SME’s create more growth in the economy, you’d have a point. But you didn’t. And if they “need supporting”, then they can’t be more efficient, can they? So why support them?” Although I’ll give you, that’ll create more jobs. Unneeded ones.”
    So we cycle back to the evil banksters..

  13. “SME’s create more jobs in the economy. They should be supported”

    Trouble is, he is both almost right and wrong. SME’s do indeed destroy jobs. The one I work for subcontracts to a large firm who in turn subcontracts to a well known utility company.

    Based on our relative efficiency (and we aren’t all that efficient tbh), our 10 man crew has probably displaced 30 men from intermediate subcontractor.

    However because ultimately this frees up loads of cash that would have paid 20 of these 30 bokes to do sweet fa all day, there is then a load of cash free which someone spends – which generally results in those 20 jobs appearing somewhere – but hopefully doing something useful. So SME’s almost create jobs – but generally only useful ones.

    As for suporting SMEs, what we want is less H&S nonsense (we ignore most of it anyway, that’s why we are 3 times as efficient as our larger customer), less red tape, and less tax. Schools that produced kids to take on as apprentices that don’t need to be taught to wipe their own backsides would be a bonus too.

  14. @the prole
    You are of course correct. It’s a slight conundrum. No successful individual SME creates jobs. By definition it destroys jobs because it replaces a less efficient activity. But the net effect will be an increase in jobs because an overall more efficient economy has greater wealth has more opportunity to create jobs. But that does no imply those jobs will be in SMEs. They may all be in producing mass market cars, for instance. Or in another country, producing goods will be imported.
    Personally, I considered the claim “SME’s create more jobs in the economy. They should be supported” was not unconnected to being the proprietor of an SME. So equivalent to a claim “More support for council spending produces jobs” Or socialism, if you like.

  15. “I thought hippocracy only came from Doctors?”

    Isn’t hippocracy rule by horses? Caligula tried that one, I believe, but it wasn’t very stable.

    Okay, I’ll get my coat…

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