MSPs’ green light to making Scots highest taxed in UK

PLANS to make Scotland the highest taxed part of the UK will be rubber-stamped today.

In a historic Holyrood vote, the SNP will secure a majority for its move to freeze the threshold for paying the higher 40p rate of income tax at £43,000, while it rises to £45,000 across the UK.

It will mean that, for the first time, higher rate taxpayers will pay £400 a year more in income tax than the rest of Britain.

Last night, opponents said the plan ‘punishes aspiration’, further increasing the gap between Scotland’s economic performance and the UK as a whole.

But Finance Secretary Derek Mackay has claimed the SNP’s approach provides Scots with ‘the best deal on tax and public services anywhere in the UK’ because it provides free prescriptions, university education, and care for the elderly.

The Scottish Government’s Budget is expected to pass its final Holyrood hurdle on Thursday, after the Greens agreed to support it. Ahead of that vote, MSPs will today be asked to approve the ‘Scottish rate resolution’ for 201 /18, which sets the rates and bands for income tax.

Scottish Tory economy spokesman Dean Lockhart said: ‘Over the last 18 months, Scotland’s growth rate has been around a third of that for the UK – with the result that employment is now falling. The SNP’s plans to set tax rates higher than the rest of the UK will only worsen this growing divide, deterring investment and reducing new jobs.’

Concerns have also been raised by the Institute of Chartered Accountants of Scotland that late changes to thresholds – introduced only a month before the new rates come into effect – could lead to mistakes being made on IT systems.

But an HMRC spokesman said it had the systems in place to collect the tax on behalf of the Scottish Government.

Mr Mackay defended his tax decision, claiming it would generate £10 million in additional revenue to protect the ‘social contract’ Scots benefit from.