We’ll all feel the pain of bungled Budget

HAD the decision to raise income tax in Scotland been purely economic, it might have been better thought-through.

Of course, it was purely a political decision – posturing as a sop to the SNP’s own socialist class warriors and to secure the votes of mercenary Green MSPs.

And so first came the shambles over the £230 married couple’s allowance. Finance Secretary Derek Mackay’s tinkering with the lower bands means many Scots will be denied the bonus and there is now an unseemly scramble to cobble a solution.

Private education is taking a spiteful blow over rates, while business employers and the British Medical Association are warning recruitment of the bright sparks we so desperately need will be tougher as Scots pay the highest income tax in the UK.

And the Scottish Fiscal Commission has predicted that thousands of wealthier workers could – as they are perfectly entitled to do – effectively opt out of income tax by incorporating themselves.

They predict this could cost Holyrood £1.5billion by 2022.

This was yet another issue Mr Mackay was appraised of before his ill-judged Budget but again, the warnings of people who know their way around a balance sheet better than him were ignored.

Safe pair of hands? The impression he gives is of a man bewildered by all this, one constantly caught out by the law of unintended consequences. Embarrassingly, Mr Mackay was unfamiliar with the Laffer Curve, which holds lower taxes yield higher returns.

Economics guru Arthur Laffer warns the Finance Secretary’s bungling will hurt the economy – and he is right again.