Income Tax: Scotland

(asked on 11th January 2018) - View Source

Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what assessment he has made of the effect of the proposal to raise income tax in Scotland on cross-border trade, employment and the location of businesses.


Answered by
Mel Stride Portrait
Mel Stride
Secretary of State for Work and Pensions
This question was answered on 19th January 2018

The Scottish government announced proposals in December which will raise income tax for many Scottish taxpayers.

These decisions are a matter for the Scottish Government, following devolution of unprecedented income tax powers, giving the Scottish government more autonomy and accountability. Therefore, it is for the Scottish Government to decide whether to increase income taxes for Scottish taxpayers.

Analysis published by the Scottish Government shows nearly all of the benefit for lower earners in Scotland is a result of personal allowance increases, and that if the UK Government had not increased the personal allowance everyone in Scotland earning over £26,000 would pay more because of these changes.

Meanwhile, this UK Government will continue to operate an income tax system that best supports a strong and prosperous UK economy – an economy that has grown continuously for 19 quarters, with a deficit that has been reduced by three quarters since 2010 and an unemployment rate at its lowest in over 40 years.

We also continue to support lower earners by cutting income tax. As a result of successive increases to the personal allowance, 1.2m individuals will be taken out of income tax altogether by 2018-19 (compared to 2015-16), and a typical basic rate taxpayer will pay £1,075 less income tax in 2018-19 than in 2010-11.

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