Banking talent retained despite supertax, says Goodman Masson

Thu, 2 Sep 2010

The supertax on banks has not resulted in a much-feared exodus of financial services talent abroad, according to Richard Hoar, director at financial recruiter Goodman Masson.

Today’s Financial Times reports that ex-Chancellor Alistair Darling told a financial services conference that his supertax, introduced last December, on bankers’ bonuses did not work and is unlikely to be repeated, claiming that those targeted by the 50% tax, payable by employers on bonuses over £25,000, were too easily able to avoid it.

And such avoidance has helped the UK retain some of its top banking talent, says Hoar. He told Recruiter: “There have been some hedge funds that have moved to Switzerland. Some firms have offered their brokers the opportunity to move abroad to benefit from a better tax regime.

“But despite the best efforts of the bank bashers, there hasn’t been a massive outflow of talent. Some firms have been paying their cash bonuses early. Banks have found ways around the tax. The tax was generally paid by the employers so there was no real haircut for the bankers involved.

“Some notable people have left the UK, but I don’t think there has been any more movement of skilled personnel globally than any normal year.”