Cheers! Duty on alcohol frozen

Chancellor delivers boost to Scotch whisky industry and brings forward tax cuts – but his claims of an end to austerity are dismissed by politicians in Scotland

Philip Hammond dropped plans to raise duty on Scotch whisky as he fast-tracked income tax cuts.

But the chancellor was attacked by politicians across Scotland for continuing with austerity.

Nearly £1 billion extra will be available for the Scottish Government over the next three years because of funding pledges made in yesterday’s Budget in devolved areas.

The personal allowance, the level at which people start paying tax, will be lifted to £12,500 in April, which arrives a year earlier than expected and will give Scots workers on the average salary a £130 tax cut.

Mr Hammond claimed that austerity is coming to an end during a Budget in which he laid out new spending commitments of £30bn over the next five years.

Derek Mackay, the finance secretary, said the commitments do not end austerity, which he said the UK Government has chosen to extend.

The SNP MSP said the resource block grant for day-to-day spending remains almost £2bn lower next year compared with 2010-11 and “falls a long way short of delivering for Scotland”.

“They could have done much more to stimulate the economy and invest in our public services and they have chosen not to,” Mr Mackay said.

“I asked the Tories to ‘show me the money’ when they declared austerity was over – looking at their budget they have instead short-changed Scotland and particularly the NHS.

“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 £50m short of what was promised only four months ago.

“The reality of today’s Budget is that Scotland continues to be hit by UK austerity and the decision to leave the EU.”

Announcing his decision to keep the freeze on spirits, beer and cider and referring to the Scottish Conservative leader’s new child, Mr Hammond said: “We can all afford to raise a wee dram to Ruth Davidson on the arrival of baby Finn.”

A hike on whisky was widely tipped to help fund the promise made by Theresa May in June for more than £20bn of extra funding for the NHS over the next five years.

But higher than expected government revenue meant he did not have to rely on tax increases.

Mr Mackay is due to unveil his Budget in December.

Scottish Conservative interim leader Jackson Carlaw said: “The ball is now in 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.”

Scottish Labour leader Richard Leonard said: “Theresa May promised the people that austerity would end but this budget has delivered nothing of the sort.”

Patrick Harvie, the Scottish Greens’ co-convener, said: “Only the Tories could applaud themselves for claiming to end austerity, having shamefully introduced the economically-crippling policy eight years ago.”

Scottish Liberal Democrat leader Willie Rennie said: “With Brexit threatening living standards across the UK, the chancellor has neither ended austerity nor addressed the fundamental problems in the economy.”