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Meeting of the Parliament 15 September 2011

15 Sep 2011 · S4 · Meeting of the Parliament

Item of business

Scotland Bill (Corporation Tax)

Ewing, Fergus SNP Inverness and Nairn Watch on SPTV

I welcome this opportunity to debate a key policy lever that should be at the heart of our strategy for sustainable economic growth in Scotland: corporation tax. Our approach to the economy is well established and clearly the people of Scotland have given strong backing to it. Our commitment to enhancing sustainable economic growth was affirmed by the publication on Monday of our new economic strategy, an important part of which is our commitment to creating an environment in which businesses have an opportunity to flourish, underpinned by a fair and efficient tax system.

In our last term and in the first 100 days of this Administration, we took—and have taken—forward a range of initiatives to make Scotland the most competitive location in the United Kingdom in which to do business. For example, we have delivered the UK’s most competitive business rates package, including the small business bonus scheme, which has either eliminated or reduced the business rates burden for tens of thousands of properties across the nation. However, under the current constitutional arrangements, many of the key job-creating powers, particularly in relation to taxation, are held back from Scotland. Indeed, more than 90 per cent of Scotland’s tax revenues are controlled by Westminster. Under the current Scotland Bill, that figure would fall to around 85 per cent.

As a result, key decisions over vital economic levers, such as corporation tax, fuel duties, national insurance and oil and gas revenues, are taken without consideration of the unique circumstances or opportunities in Scotland.

I firmly believe that Scotland’s best interests are served by taking full responsibility for the key policy decisions that affect the Scottish economy. That is why we are committed to holding a referendum on independence. However, our immediate constitutional priority is to improve the Scotland Bill. While we have offered detailed proposals for truly enhancing our decision-making powers, the UK Government continues to engage in a negative campaign of scaremongering over any attempt to improve the Scotland Bill—scaremongering for which, I noticed with some approval, Lord McConnell recently criticised the former Prime Minister.

Are we really to believe the claims from the UK Government that reducing corporation tax to 12.5 per cent in Scotland would reduce our budget by £2.6 billion? Does it not realise that that figure is actually the total amount of corporation tax raised in Scotland? I hope that today we can have a proper debate on the potential opportunities to add economic powers to the Scotland Bill.

The financial framework for the Scottish Parliament needs reform, with a greater focus on accountability and fiscal responsibility. It surely cannot be the summit of our collective ambitions—for any member in this chamber, from any party—simply to rely on a handout from the London Treasury.

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Meeting of the Parliament 15 September 2011

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