Prudent limits
Sir: I refer to your editorial 'The limits of Prudence' (18 May). The Americans have attempted an imaginative solution to the paradox of declining wages and benefits for workers and improving salaries and perks for directors and senior executives.
Although I do not know if the provision remains on the statute book, in terms of Section 89 of the US Tax Law the expense to an enterprise of the benefits and salary improvements paid to directors and senior managers, which are not proportionately applied to ordinary workers, are not tax deductible. Only those benefits and incre- ments which are proportionately applied to the general workforce are tax deductible as expenses incurred in the course of earning income.
Perhaps an equivalent provision in the UK would curtail the avarice of your overpaid chief executives.
C. J. Albertyn
1101 Salmon Grove Chambers, 407 Smith Street, Durban, South Africa
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