(UK) Companies try to avoid 50% top tax rate by altering pay policies

[Newsjock]

Source: The Guardian

Britain's leading companies are devising pay schemes that enable top executives to escape the new 50p rate of income tax for high earners that takes effect in April, the Guardian has learned.

Some of the biggest companies in the country are constructing complex pay schemes that risk infuriating government ministers, who are determined to crack down on tax avoidance. Some of these schemes are "nakedly" intended to allow senior boardroom bosses to pay a tax rate of 18% instead of the 50% top rate, according to one industry expert.

... When it was announced in April, the government said the new 50% band will be levied on the estimated 350,000 people with incomes above £150,000 a year – easily capturing the executives in the boardrooms of Britain's biggest companies.

A number of pay plans are currently on the drawing board and differ subtly from the current schemes used in Britain's biggest boardrooms. Many of them seek to re-classify executives' income as capital gains, which attract a lower tax rate.


Read more: http://www.guardian.co.uk/business/2009/dec/28/executive-pay

[drm604]

1. They have no shame. n/t

[SergeStorms]

2. Ahhhhhh....The Golden Rule

Those who have the gold make the rules. :mad: There always seem to be loopholes for the rich. If there aren't, they seem to be able to create whatever loopholes they need out of thin air. Why, it's almost as if lawmakers leave these gaping holes open for the rich to exploit! :shrug: Nah....... they wouldn't do that. Would they?

[Lorien]

8. I remember Bush jr. scoffing at the idea that the rich should pay more in taxes

because "The rich don't pay taxes to begin with, so making laws to make them pay more won't work!" :grr:

[rfranklin]

3. Simple solution, no special classification for capital gains...

Tax all income as income.

[RUMMYisFROSTED]

5. ...and that post is going to leave the yard...

:thumbsup:

[burning rain]

4. Chuck a few of the people responsible for such chicanery in prison.

The business critters will then pay their goddamn taxes without a fuss. They are mostly a cowardly lot, far too wedded to soft comfort to put up a fight and risk losing it, not at all the bold heroes of Ayn Rand's childish fantasies.

[One_Life_To_Give]

6. Like nobody should of seen this coming

:sarcasm:

[WriteDown]

7. Money is like water...

It finds a path.

[w4rma]

9. Yeah. Why even enforce laws against money laundering? (nt)

:sarcasm: