The Reasoned Review

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Bonus Tax

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Yet more evidence that our friends across the Atlantic have a firmer grasp on democracy than we do: Britain is set to levy a major one-time tax on those scurrilous “bonuses” the banks are handing out with taxpayer money.

The UK government will hit the bankers with a 50% tax on any bonuses greater than $40,000, this year only. In doing so, they will make up a good portion of their budget shortfalls and send a clear message to the financial industry that the taxpayer bailouts are not a gift to the few.

Can such a thing happen here? In the words of the Brookings Institution: not likely.

“I think it is very unlikely that you would see this kind of tax on bonuses here in the U.S.,” Douglas J. Elliott at the Brookings Institution in Washington said. But, he added, “There are going to be big bonuses this season. There will be high levels of public anger. Therefore there will be some bills introduced. I just don’t think they are going to make it through.”

Why? Because unlike in Britain, our entire legislative process has been bought by the major financial institutions, part and parcel.

As Finance Minister Alistair Darling said:

“If they insist on paying substantial rewards, I am determined to claw money back for the taxpayer.”

Can one even imagine such words coming from our own Bailout Chiefs?

Written by pavanvan

December 10, 2009 at 2:14 pm

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