Multi-million pound bonuses shared by workers in the City this Christmas are under fire from the anti-poverty charity War on Want.
According to the charity, many of the world’s poorest countries are being denied the tax owed by British companies amidst reports that dozens of London bankers at Goldman Sachs have been awarded bonuses of at least £5 million each, in a record global bonus pool of £9 billion.
Other banks are expected to hand out large bonuses, including Barclays Capital, DresdnerKleinwort, Lehman Brothers, UBS and Morgan Stanley.
The International Monetary Fund has branded the City an onshore tax haven for its role in helping companies dodge tax. War on Want claims tax dodging and capital flight costs Africa an estimated £75 billion each year – five times what the continent receives in aid.
According to the charity, developing countries lose an estimated £250 billion every year as a direct result of corporate tax dodging – money which, it says, could be used to reach the UN’s anti-poverty goals several times over.
War on Want says one popular way of dodging tax is to register companies in tax havens. Many of the world’s tax havens are British, including the City of London.
John Hilary, campaigns and policy director at War on Want, said: “It is a scandal that the City of London is handing out these bonuses while denying developing countries billions of pounds in tax owed. Executives on these bonuses can get to eye up luxury cars or second homes while millions of poor people struggle to survive. The government should make City firms pay their full taxes before dishing out these obscene Christmas bonuses.”
