Mackay challenged to abandon tax increases after £350 million boost
The Scottish Conservatives yesterday challenged SNP ministers to abandon plans to hike taxes after the Chancellor handed an extra £350 million to Holyrood.
The cash comes to the Scottish budget via the Barnett Formula, which decides the amount of money received by the devolved institutions when spending is increased south of the Border.
The £350m will see the Scottish resource budget increase by £260m by 2020 and the capital budget go up by £60m by 2021.
Philip Hammond said the funding package was “demonstrating once again that we are stronger together in this great United Kingdom”.
Tory finance spokesman Murdo Fraser said the extra money could enable Finance Secretary Derek Mackay to reverse his decision not to pass on UK government tax breaks to higher earners in Scotland. Mr Mackay has declined to follow the UK government’s plan to raise the threshold for those in the 40p income tax band.
Mr Fraser said: “The Chancellor has struck the right balance in this Budget – keeping money in reserve as we prepare to leave the EU, but at the same time handing a boost to the economy.
“For Scotland alone, his plans will deliver an extra £350m for the SNP government to spend as it wishes over the coming years. The SNP’S double dose of local government cuts and income tax changes to penalise middle earners is now utterly without justification.
“The simple truth is that, if it was focused on the day job, the SNP wouldn’t need to make Scotland the highest-taxed part of the UK.”
But Mr Mackay said that despite the increase in Barnett consequentials, the “Chancellor’s spring Budget plans confirm £2.9 billion of cuts to the Scottish budget over ten years”.
He said: “The Chancellor has today confirmed a real-terms cut to the Scottish budget of 9.2 per cent between 2010-11 and 2019-20. No-one should think that this Budget provides an end to austerity from the UK government – in fact there is still a further £3.5bn of cuts to come.
“On top of that, the Chancellor continued with the UK government’s damaging welfare cuts that will make many vulnerable and low income households worse off.”