US politicians move against banking bonuses
US politicians move against banking bonuses
Friday 20th March 2009
Plans to strip high-paid banking executives of their bonuses in the United States are gathering steam.The House of Representatives voted 328 to 93 in favour of a 90 per cent tax on all bonuses paid to those earning over $250,000 (£173,000) in bailed-out companies.
It follows the revelation that insurance group AIG, which received $170 billion (£118 billion) in public money, paid out $165 million (£114 million) in bonuses.
The bonuses in the House proposal become taxable only for companies who have received more than $5 billion (£3.5 billion) in assistance under the assets relief programme.
Taxing bonuses is not guaranteed to occur in this form, however, as the Senate is yet to approve the plans.
Congress' upper house reportedly favours a 35 per cent excise tax on executive bonuses.
Republicans, who form a minority in both houses, are criticising Democrats' efforts to keep up with extremely hostile public opinion against Wall Street.
House minority leader John Boehner said: "This bill is nothing more than an attempt for everybody to cover their butt up here on Capitol Hill."
President Barack Obama has indicated his approval for the House bill.
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