Sir Mervyn vs Goldman Sachs

Sir Mervyn King to the Treasury Select Committee on reports Goldman Sachs planning to delay payment of bonuses this year until the 50% tax rate is removed in April:

I find it a bit depressing that people who earn so much find it would be even more exciting to adjust their payouts to benefit from the tax rate, knowing that this must have an impact of the rest of society, which is suffering most from the consequences of the financial crisis. I think it would be a rather clumsy and lacking in care and attention to how other people might react. And in the long run, financial institutions do depend on goodwill from society.

Update: worth pointing out that neither Sir Mervyn nor the MP who asked him the question, Teresa Pearce, mentioned Goldman Sachs by name but it was clear both from the question and the response that the pair were referring to this story, which has had considerable follow-up since.

In her question, Teresa Pearce referred to “The recent report on people deferring their bonuses to the 6th of April – do you think that’s ordinary tax planning or morally repugnant?”

Update 2: Goldman Sachs has decided not to defer the payment of its bonuses as had been mooted in the FT story above. The option was considered at a meeting of its compensation committee today but they decided not to take it up. I wonder why…

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