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Jimmy Choo & UK Taxes

December 30, 2009

A few weeks ago, there was a massive flurry about London town as women of all shapes and sizes seemed to be drooling over the oh-so-desirable Choos. H&M UK was going to carry the much esteemed brand at greatly slashed prices for a very limited period of time. I admire the people behind the H&M brand and their innovative business models. What I was much amused by, as always, was the insanity of shoppers to follow their lust through to queueing up overnight in the rain and cold for a brand pair of shoes.

Various thoughts about the H&M episode had been playing on my mind for a couple of weeks – the usual gripes about an overly materialistic society vying for a look that is clearly not reflective of their economic power, instead of putting in the same energy into actually aspiring to create wealth through entrepreneurship and such. It was a hard post to write up because I can hardly claim to be austere when it comes to retail mania – I have had my weak moments and to point fingers at others would probably constitute what can politely be called hypocrisy and, impolitely, bitchiness.

And then UK Pre-Budget Report was released. And I continue to be amused.

Every single person standing in those queues for the much-anticipated Jimmy Choo shoes was surely aspiring to a lifestyle that several high-earning bankers enjoy – the brand names, the expensive meals and famously lavish holidays. And yet, quite likely, almost everyone in those same queues would be celebrating the blow to bankers in the UK in the form of a one-off ‘windfall’ tax of 50% levied on the employer even before the bonus is paid out, for bonuses over £25k. That is, for every £100 over £25k, £50 would be paid to the exchequer straight out, and then the employee would pay another £20 as income tax, for a net take-home pay of £30.

Is it only me who finds it absurd that in its economic value system, modern society supports, indulges and actively aspires towards the excesses that are associated with the most successful and capitalistic of bankers and yet it craves to crucify those who are the most successful aspirants of such a lifestyle, very much in a socialist fashion? How can the UK clamour for the very capitalistic Jimmy Choos in the same breath as they ensnare bankers in a socialist trap?

My point is not justify or attack eitherof the phenomena, but to point out the inherent contradiction we are now mired in – who sees a way out of this logical quagmire?

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