Household spend stuck

Labour blast ‘loophole’ Union: Stop spin on pay

A LOOPHOLE in Derek Mackay’s Budget will see some high earners in Scotland pay less tax next year than they do this year, Labour have claimed.

Figures confirmed by the Scottish Parliament show that people earning between £43,525 and £58,500 will pay less tax in 2018-19 than they do in 2017-18.

The embarrassing anomaly means that, for example, an earner on £44,275 would receive a tax cut of £142 per year, £52 more than for a worker who earns £15,000. The situation comes about because of the interaction between the two new tax rates at 19p and 21p.

Scottish Labour finance spokesman James Kelly MSP said: “The SNP Finance Secretary has chosen to effectively cut lifeline services by £700million, while giving a tax break to those earning more than double the average salary.”

Mackay said: “Our new income tax policy will protect the 70 per cent of taxpayers who earn less than £33,000.” THE amount of money households have to spend is not expected to rise for three years, according to experts.

The Scottish Fiscal Commission said a combination of slow wage growth and inflation meant that real household disposable income is unlikely to increase until 2020-21.

The findings are revealed in the SFC’s forecasts, which were published as Finance Secretary Derek Mackay announced his draft Budget for 2018-19. SCOTLAND’S civil service trade union have called on Derek Mackay to “stop the spin” on public sector pay and recognise his Budget still represents a pay cut for public and civil servants.

The Public and Commercial Services Union said proposals to break the one per cent pay cap were a move in the right direction but still left members out of pocket.

PCS national officer Lynn Henderson said: “Let’s stop the spin – every worker who reads about the Budget will know that this is still not a pay deal which matches the rising cost of living, nor makes up for 10 years of pay cuts.”

The Finance Secretary was also criticised for cutting local government workers out of his offer – the three per cent pay rise for public workers earning less than £30,000 does not cover council workers or civil servants employed by the UK Government in Scotland.

But the SNP’s Linda Fabiani said: “The Tories need to match our commitment to public sector workers.”