Goldman Sachs looks to Spain on bonus tax

Goldman Sachs could move up to one fifth of its 5,000 London-based staff to Spain, the Independent has reported.

The bank, which according to the newspaper is the UK’s biggest contributor of revenue in the financial sector, is in a stand-off with the Treasury over the temporary bonus tax announced in the recent pre-Budget report.

Last week, Barclays’ chief executive, John Varley, warned that the temporary levy of 50% on individual discretionary bonuses of over £25,000 could damage the City.

In an interview with the BBC, the banker criticised the Government for not ensuring a “predictable tax environment” in the UK and appealed for a “level playing field” in the face of global competition.

In related news, HM Revenue & Customs has confirmed that the bonus tax does not apply to insurance companies, asset managers and stockbrokers.

Concerns had been raised over the definition of a “bank” as used in the draft legislation and HMRC has concluded “that the original definition of a ‘bank’ did not effectively exclude all the groups we intended to exclude”.

The draft legislation is therefore being amended to exclude stock brokers and insurance companies.