TUC calls for corporation tax on bosses' bonuses that top £250,000

Their plea comes just days after RBS, HSBC, Lloyds and Barclays agreed to cut the amount provided for bonuses in 2010. The agreement, called "Project Merlin", does not control salaries and only requires publication of the pay of the five highest paid executives below board level.

The TUC plan calls for disclosure of all pay and bonuses which were ten times the level of average pay - currently about 25,000 in the UK.

Company remuneration committees should also be broadened to include staff representatives, and non-executive director posts should be advertised and recruited in a "transparent manner", said the union.

The TUC said that while last year's bonus tax raised significant tax revenues, making big bonuses liable for corporation tax would be a better long-term solution as it would be harder for companies to avoid and could be extended across all company boardrooms.

And while few bonuses would meet that level in Scotland, union leaders said City boardroom pay continued to fuel anger as local cuts "start to bite".

UK general secretary Brendan Barber said: "The way to end banker bashing is to fix the banking system so that it serves the wider needs of the country.

"Making mega-bonuses liable for corporation tax could drive reform of our boardroom bonus culture and raise revenues so that the tax burden does not fall so heavily on low and middle income families.

"The finance sector needs reform if we are to avoid another credit bubble, but from corporate tax cuts to opposing international regulatory reform, the current government has matched fighting talk in front of the cameras with pathetic subservience behind closed doors."

Stephen Boyd, general secretary of the STUC, added that although there were few bonuses given in Scotland that would be subject to the corporation tax plan, the Scottish Government should indicate what they would do, given the chance.

He said: "It's for the public to ask where the government stand on this. It would be reasonable, if they do want to achieve independence, to say if they support this kind of measure.

"There has been no effective reform of the ability for corporations to pay these bonuses. Public anger is increasing and a lot of people who did not feel the recession affected them are now feeling the pinch. While the cuts start to bite, the culture in the banking sector has not changed; it's just growing."

Both Labour and the SNP hit out at the coalition government's position on bonuses.

Labour MSP for Edinburgh Central Sarah Boyack said: "The coalition government talks tough on bank bonus, but acts weak. The Tories won't explain why the government is giving the banks a tax cut this year compared to last."

SNP Treasury spokesman, Stewart Hosie MP added: "Bonuses, where and if they must be paid, should be issued in shares and therefore be locked into the longer-term future of the businesses."