A SINISTER THREAT ON RAISING TAXES
Swinney sparks fears of bigger burden on families to fund benefits splurge
HARD-WORKING Scots families face an income tax bombshell after John Swinney refused to rule out a rise in rates to pay for the SNP’s benefits splurge.
The Finance Secretary revealed his party is considering changes ahead of the Scottish government being given more fiscal control.
Alarmingly, he promised the changes would be similar to his wildly unpopular l and and buildings transaction tax (LBTT), which replaced stamp duty in April and was branded a ‘tax on aspiration’ by critics.
There will be concerns he plans to further penalise middle-class Scots striving for a higher wage to provide a better life for their families.
Yesterday, businesses warned him against making Scotland uncompetitive, with higher taxes than the rest of the Uk, jeopardising jobs and the wider economy.
Scots currently pay £400 more tax per person than the rest of the Uk but public spending is £1,200 per person higher.
The Scotland Bill, based on the Smith Commission’s cross-party recommendations, will make Scotland more responsible for funding the SNP’s spending on free prescriptions, bus passes for the elderly and abolishing the so-called ‘bedroom tax’ north of the Border.
Mr Swinney was asked on BBC1’s Sunday Politics Scotland whether he would use a tax rise to cover extra spending on benefits. He replied: ‘We’ll obviously give consideration to that as we formulate our proposals for the 2016 election.
‘What we’ve demonstrated already on the tax powers that have already been devolved to us – on stamp duty and on landfill tax – is that on the first available opportunity, the Scot- tish government has acted on those taxes and on stamp duty we changed it very radically to reflect our position that tax should be structured on the ability to pay.’
He was challenged yesterday by Scots Tory leader Ruth Davidson to rule out a tax rise.
Mr Swinney said: ‘I can’t give that pledge today, and I won’t give it, because I want to make sure that my party has the opportunity to exercise the choice that we believe is appropriate in the relevant circumstances to ensure we take the right decisions.’
It will raise further fears the SNP is determined to pursue an antibusiness and anti-wealth agenda.
The LBTT reforms have left anyone buying a house for more than £333,000 worse off, making life particularly difficult for growing families in Edinburgh and Aberdeen, where prices are higher.
During the general Election campaign, the SNP called for a 50p top rate of income tax, though David Cameron’s decision to cut it to 45p has led to more money collected by the tax man.
Hugh Aitken, director of CBI Scotland, warned: ‘We need a competitive tax regime that does not deter talented people from investing in businesses and creating jobs on both sides of the border.’ David Lonsdale, director of the Scottish Retail Consortium, said: ‘Far greater certainty is needed over how the new devolved rate of income will affect take-home pay, consumer confidence and the ability of employers to attract and retain talent.’
Earlier, Miss Davidson threw down the gauntlet to the SNP.
‘I pledge that, under my leadership, a future Conservative Scottish government will never have higher rates or bands of income tax than elsewhere in the Uk,’ she said.
‘And I challenge my political opponents to commit to a tax regime that does not take more money from Scottish income tax payers than they would have paid under the Westminster system.’
Her party said that Mr Swinney’s failure to rise to the challenge was a blow to businesses and families.
Tory chief whip John Lamont said: ‘John Swinney today failed to offer any assurances to hard-pressed taxpayers on how new income tax powers will be used by the SNP when they start being introduced next year.
‘our view is that Scottish families and businesses deserve a simple commitment that Scottish taxes will not be used to raise more than the current Uk system. That commitment would help to embed our economic recovery and would be a massive fillip towards achieving our goal of full employment.’
Scots Lib Dem leader Willie Rennie said: ‘ John Swinney seems strangely reluctant to spell out what the SNP would do with the tax powers that will be coming to the Scottish parliament.’
He added: ‘The Finance Secretary needs to come clean and tell working
‘Failed to offer any assurances’
Scots what a vote for the SNP next year would mean for their tax bills.’
Labour, which backed a 50p top rate during the election campaign, accused the SNP of failing to fund struggling schools. Finance spokesman Jackie Baillie said: ‘The prob- lems in Scottish education are mounting up. overworked, exhausted teachers, a Higher exams fiasco, literacy and numeracy rates falling and an attainment gap which shows Scotland a divided country when it comes to opportunities for young people.’ She added: ‘The Scottish government have squeezed education spending in Scotland harder than the Tories in Westminster. They cannot continue to ignore the results.’