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David Prosser: Let's at least get the bonus numbers right

Thursday 13 January 2011 01:00 GMT
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Outlook Finally, and still on the topic of bonuses, it was disappointing to see the Prime Minister throwing around such misleading figures yesterday when challenged on City pay by Ed Miliband. His insistence that the £2.5bn it will raise from the banking levy this year is more than the £2.3bn raised by the Labour government last year with its windfall tax on bonuses would have been a more convincing rebuttal of Mr Miliband's criticisms if it had been true.

The facts are these: last year's tax raised £3.5bn. The lower £2.3bn figure is based on some guesswork about how much tax and national insurance the Exchequer missed out on because banks paid lower bonuses in light of the tax than they otherwise would have done. This year's levy, meanwhile, will raise just £1.3bn, because it will not be charged at the full rate until next year.

Mr Cameron might have pointed out that the levy is a permanent tax while Labour's charge was a one-off. Instead he chose to bedishonest about the figures.

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