Labour exposes Osborne's tax cut for bankers

New figures from the party show that 643 bankers earning more than £1m a year will receive an average of £54,000 from the cut in the 50p tax rate.

After a week dominated by welfare cuts, an area where public opinion favours the coalition, Labour is hoping to regain the political advantage tomorrow when the 50p tax rate is officially reduced to 45p. Polls have consistently shown that the public, including Conservative voters, are overwhelmingly opposed to the move and an increasing number of Tory MPs (such as Jesse Norman and Robert Halfon) recognise that the decision inflicted permanent damage on their party's brand. 

Labour has dubbed tomorrow "Tory Millionaires' Day" after calculating that the UK's 13,000 income millionaires will receive an average tax cut of £100,000 a year (nearly four times the median salary of £26,500). Now the party's number crunchers have produced some equally potent stats on the gains that the top earning bankers will make. Labour has calculated that 643 bankers, working in the UK's five major banks and earning more than £1m a year, will receive a combined tax cut worth at least £34.6m per year - an average of £53,775 per banker. Millionaire bankers in the state-backed RBS and Lloyds are set to get a tax cut of over £7.5m per year - an average of £63,686 each. In addition, the 40 highest paid senior bank executives will receive a tax cut worth almost £4m - an average of £99,694 each.

Chris Leslie, the shadow financial secretary to the Treasury said:

People on middle and low incomes, who are paying more in higher VAT and seeing their tax credits and child benefit cut, will be totally appalled at the size of this government's tax giveaway to highly paid banking executives.

While the average family will be £891 worse off this year because of tax and benefit changes since 2010, it cannot be right for David Cameron and George Osborne to give a huge tax cut to millionaires this weekend.

Forcing millions to pay more while millionaires pay less is the act of a government that is totally out of touch and consistently stands up for the wrong people. Bankers are getting a bonus from David Cameron and George Osborne, while Britain's families pay the price for their economic failure.

For Osborne, who was careful in the Budget to emphasise that the banks would not benefit from the reductions in corporation tax, the figures are a political headache. The Chancellor's consistent line is that the 50p rate was ineffective because the rich avoided it (in fact, as I explained here, it raised £1bn in its first year and would have gone on to raise more) but to most voters that sounds like an argument for clamping down on avoidance (as the coalition claims it is doing), not for cutting taxes for the highest earners. 

People walk past the Royal Bank of Scotland building in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Appreciate the full horror of Nigel Farage's pro-Trump speech

The former Ukip leader has appeared at a Donald Trump rally. It went exactly as you would expect.

It is with a heavy heart that I must announce Nigel Farage is at it again.

The on-again, off-again Ukip leader and current Member of the European Parliament has appeared at a Donald Trump rally to lend his support to the presidential candidate.

It was, predictably, distressing.

Farage started by telling his American audience why they, like he, should be positive.

"I come to you from the United Kingdom"

Okay, good start. Undeniably true.

"– with a message of hope –

Again, probably quite true.

Image: Clearly hopeful (Wikipedia Screenshot)

– and optimism.”

Ah.

Image: Nigel Farage in front of a poster showing immigrants who are definitely not European (Getty)

He continues: “If the little people, if the real people–”

Wait, what?

Why is Trump nodding sagely at this?

The little people?

Image: It's a plane with the name Trump on it (Wikimedia Commons)

THE LITTLE PEOPLE?

Image: It's the word Trump on the side of a skyscraper I can't cope with this (Pixel)

THE ONLY LITTLE PERSON CLOSE TO TRUMP IS RIDING A MASSIVE STUFFED LION

Image: I don't even know what to tell you. It's Trump and his wife and a child riding a stuffed lion. 

IN A PENTHOUSE

A PENTHOUSE WHICH LOOKS LIKE LIBERACE WAS LET LOOSE WITH THE GILT ON DAY FIVE OF A PARTICULARLY BAD BENDER

Image: So much gold. Just gold, everywhere.

HIS WIFE HAS SO MANY BAGS SHE HAS TO EMPLOY A BAG MAN TO CARRY THEM

Image: I did not even know there were so many styles of Louis Vuitton, and my dentists has a lot of old copies of Vogue.

Anyway. Back to Farage, who is telling the little people that they can win "against the forces of global corporatism".

 

Image: Aaaaarggghhhh (Wikipedia Screenshot)

Ugh. Okay. What next? Oh god, he's telling them they can have a Brexit moment.

“... you can beat Washington...”

“... if enough decent people...”

“...are prepared to stand up against the establishment”

Image: A screenshot from Donald Trump's Wikipedia page.

I think I need a lie down.

Watch the full clip here:

Stephanie Boland is digital assistant at the New Statesman. She tweets at @stephanieboland