Deutsche bank to ‘spread’ UK bonus tax worldwide

Bankers at Deutsche Bank have come up with a plan to limit the burden of Alistair Darling's supertax on bankers' bonuses: spread it across Deutsche staff around the world.

Deutsche chiefs are running the risk of angering their non-London based bankers. But it's a one-for-all and all-for-one solution that is reportedly being considered by several US banks.

"We will clearly globalise it," Josef Ackermann, Deutsche's chief executive, told the Financial Times. "If parts of the cost of the tax are paid out of the bonus pool, we would seek to globalise it. It would be unfair to treat the UK bankers differently."

The ramifications of Darling's shock tax are still being digested. UK bankers are angry at being paid less than their foreign colleagues while foreign-based bankers do not want to be penalised. Neither the Chancellor nor the Bank of England show signs of concern over warnings the supertax could cost the City in terms of reputation or jobs.

Indeed, Darling appears increasingly bullish about his bonus supertax, telling the Treasury Select Committee that while the 50 per cent levy was expected to raise more than £550m in revenue, that was not the point – the real purpose was to persuade banks to change their behaviour.  

"I say to the bankers, you've got to help yourselves to get through this process, and that means if you want to get off the front pages, for goodness' sake show some of the restraint the public want you to," he said.

Yesterday, the Bank of England reported in its twice-yearly Financial Stability Report that the entire taxpayer-funded rescue might have been unnecessary if bonuses and dividends had been cut by a fifth in the years before the crisis.

The banks would then have had an extra £75 billion on their balance sheets, a figure that suggests UK-based banks paid out a staggering £425 billion in staff bonuses and dividends between 2000 and 2008.

The BOE report also states that, despite current worries over the economic recovery, corporate bonds have rallied so strongly that investors are now sitting on profits of $700 billion. ·