NOW GIVE US A BREAK, NICOLA

As Scots miss out on Hammond’s income tax boost for families, he hands SNP Government a £950million Budget windfall. So...

PHILIP Hammond handed the Scottish Government a cheque worth nearly £1billion yesterday as he loosened the nation’s purse strings in a bid to end austerity.

In a dramatic shift of approach, the Chancellor signed off the biggest spending spree since the financial crash and heaped pressure on Nicola Sturgeon to ease the burden on hard-pressed Scottish taxpayers.

During what is expected to be his last Budget before the UK leaves the EU, Mr Hammond hailed Britain’s ‘strivers, grafters and carers’ with a series of pledges to boost the economy and fund vital public services.

He confirmed the Government will deliver on a key manifesto pledge 12 months early – which will see more than 30 million workers benefit from a tax cut.

The move means that all basic rate taxpayers in the UK will receive a £130 bonus days after Britain leaves the EU next year.

But while higher rate taxpayers in England, Wales and Northern Ireland will also receive a whopping cut of up to £860 a year, thousands of Scots are set to see their bills

soar following the SNP’s decision to introduce a series of new income tax bands and rates.

Experts have now warned of a ‘growing gulf’ between middle-earners north and south of the Border, with the First Minister urged to help Scots taxpayers hit hardest.

Mr Hammond’s £100billion spending spree will see £950million handed to the Scottish Government in Barnett consequentials, which critics have told the SNP to spend on hospitals, schools, roads and housing.

In a wide-ranging Budget, the Chancellor:

Announced plans for a £400million digital services tax on Amazon, Facebook, Google and 30 other web giants;

Agreed an extra £1billion for defence spending to fund improvements in the UK’s cyber, nuclear and antisubmarine defences;

Responded to the Daily Mail’s campaign for action to save the high street by slashing business rates by a third for small companies – which will see £42million handed to the SNP to help introduce similar relief;

Shelved plans for a ‘latte levy’ on disposable coffee cups, but announced a new tax on firms that fail to use recycled plastic;

Faced Labour claims that his ‘giveaway’ Budget was clearing the decks for an election in the coming months;

Confirmed plans to freeze fuel duty for the ninth year in a row, and a £420million fund to tackle potholes with £41million worth of Barnett consequentials for Scotland;

Announced that a freeze on spirit duty will continue in a major boost for the whisky sector;

Abandoned plans to raid pensions and hike taxes following warnings they would be voted down by MPs;

Unveiled a string of measures designed to unlock business investment as the UK leaves the EU.

Last night, the UK Government urged Miss Sturgeon to use the Scottish Budget in December to follow its lead by investing heavily in major services – such as the NHS and schools.

Scottish Secretary David Mundell said: ‘Today’s Budget is great news for people in Scotland. The Chancellor’s decisions mean there will be an extra £1billion to invest in public services in Scotland. I urge the Scottish Government to use this extra money to support the NHS in Scotland, fix the roads, boost Scotland’s economy and reinvigorate Scotland’s high streets.’

He added: ‘Today’s Budget demonstrates clearly how the UK Government is delivering for people in Scotland.’

Mr Hammond yesterday used his Budget to raise personal allowance for income tax to £12,500 a year earlier than first promised.

Those on the basic rate will save £130 a year from next April in a move which will also affect Scottish taxpayers.

He has also pledged to raise the higher rate threshold to £50,000 at the same time. However, this will not help Scots – as the SNP would have to deliver the same.

At present the threshold stands at £43,430, which means someone earning £50,000 in Scotland pays £850 more in income tax than their counterpart in the UK. This will rise to more than £1,500 more if the SNP does not follow the Tories’ lead.

The Fraser of Allander Institute last night said the Scottish Government now faces ‘huge pressure’ to raise the higher rate threshold – but warned this will not be ‘palatable’ with the Scottish Greens who the SNP has relied on in the last two Budgets.

Laura Mair, accountancy firm EY’s head of tax in Scotland, said yesterday’s announcement has ‘widened the gap’ between higher earners in Scotland and those elsewhere in the UK.

Scottish Tory interim leader Jackson Carlaw said: ‘There is a Barnett bonus of almost £1billion which the SNP Government can get to work on spending straight away. The ball is now in [Finance Secretary] Derek Mackay’s court.

‘With tax cuts being delivered south of the Border, the case for yet more SNP tax rises next year in Scotland is simply unsustainable. Nicola Sturgeon must rule it out, now.’

Last night, Mr Mackay said: ‘According to this Budget, the Scottish Government’s resource block grant from the UK Government – the money we are able to invest in dayto-day public services – remains almost £2billion lower next year compared with 201011. This Budget falls a long way short of delivering for Scotland.’

He added: ‘The Scottish Government has already set out our plans to support the NHS in the years to come and the funding we have received as a result of health spending in England will go to our NHS in Scotland – but so far the UK Government has fallen at least £50million short of what was promised only four months ago.’

Meanwhile, Mr Hammond also bowed to pressure from Tory MPs by releasing an extra £6.6billion to ease the rollout of the Universal Credit scheme in the next five years.

Comment – Page 16

‘Delivering for Scots’