Committee
Finance and Public Administration Committee 06 January 2026
06 Jan 2026 · S6 · Finance and Public Administration Committee
Item of business
Subordinate Legislation
Land and Buildings Transaction Tax (Investment Zones Relief) (Scotland) Order 2026 [Draft]
Yes. However, looking at the context, the work in relation to investment zones and green ports has largely been focused on the attraction of international investment for cluster developments. The package of £320 million from the UK Government includes money to cover the foregone loss of the cost for LBTT—that money is covered by the UK Government in any event. For the Scottish Government, it is all upside, because it is about the other revenue that you get from income tax or other taxes over time from the economic activity and its multiplier effects. There is no loss to the Scottish Government per se in that regard.
In the same item of business
The Convener
SNP
Our next agenda item is an evidence session with the Minister for Public Finance on the Land and Buildings Transaction Tax (Investment Zones Relief) (Scotlan...
The Minister for Public Finance (Ivan McKee)
SNP
Good morning, convener, and happy new year to you and to the committee. I welcome the opportunity to discuss the SSI with you and I look forward to the commi...
The Convener
SNP
Are there any concerns about displacement activity with regard to the investment zones? We discussed the issue in relation to green ports a couple of years a...
Ivan McKee
SNP
That is a fair comment. It is important to look at that aspect—and, indeed, at the green ports work—through the lens of what we are trying to achieve, which ...
The Convener
SNP
Will those investment zones be in competition with green ports, for example? I know that green ports are ports, obviously, but what about attracting investment?
Ivan McKee
SNP
The investment zones are focused on specific areas and technologies—the one in Glasgow is centred around advanced manufacturing and AI, so it is quite a spec...
The Convener
SNP
Why were those two areas picked? For example, my area in North Ayrshire has the highest level of vacant and derelict land, proportionately, in Scotland, so i...
Ivan McKee
SNP
The process, which I was not involved in at the time, was a joint process between the UK Government and the Scottish Government. As I said, it was a rigorous...
The Convener
SNP
What additional wealth are you hoping that those zones will create, given the fact that there will be a reduction in revenue from LBTT? I would hope that the...
Ivan McKee
SNP
The first point to note is that LBTT happens only when somebody moves into the area, so if the counterfactual is that the transaction did not happen, you are...
The Convener
SNP
Well, if they move somewhere else where they have to pay, you are losing money. That is the point.
Ivan McKee
SNP
Yes. However, looking at the context, the work in relation to investment zones and green ports has largely been focused on the attraction of international in...
The Convener
SNP
But there is no ability to quantify the gain that one would hope to secure in terms of employment, additional taxation, additional revenue or whatever.
Ivan McKee
SNP
It is not part of my portfolio, but I can come back to you on that matter—unless officials have anything specific to say on the numbers. There are certainly ...
Liam Farrow (Scottish Government)
First of all, LBTT is an important part of the overall package, but the vast majority of the funding that will come to us from the UK Government for these in...
The Convener
SNP
I am sorry, but over what time period?
Liam Farrow
Over the 10-year period of the programme. There will be more detail forthcoming in the coming months, but we are somewhat beholden to the regional economic p...
The Convener
SNP
Okay. We have had regional planning partnerships, green ports and so on, and vast numbers of jobs always seem to be attached to them, but I never really see ...
Ivan McKee
SNP
We have seen a number of significant investments, with jobs running into the hundreds. They were really just at the start of the process.
The Convener
SNP
To be fair, one would say that the situation is quite uneven throughout the country. We are not seeing it in Ayrshire, and I think that there are other areas...
Michael Marra
Lab
Minister, you said that you were not the minister in charge at the start of the process, which I think dates back to 2023. What is your understanding of how ...
Ivan McKee
SNP
I was heavily involved in the green ports process, but I was not involved in the investment zones process. My understanding, though, is that a rigorous asses...
Michael Marra
Lab
Was there any application process?
Ivan McKee
SNP
Not to my knowledge, no.
Michael Marra
Lab
The allocation was made on 22 June 2023, I think, and then it was announced that Glasgow and Aberdeenshire had qualified. However, it appears that the only c...
Ivan McKee
SNP
As I have said, I was not involved in that process. My understanding is that a rigorous process was undertaken by the two Governments, with a number of crite...
Michael Marra
Lab
Can you provide those criteria to the committee, in writing if not today? Perhaps your official wants to do so.
Liam Farrow
The methodology for the selection process is available online, and it involves high-level consideration of economic potential, innovation and knowledge ancho...
Michael Marra
Lab
It strikes me that, at the time—in June 2023—the principal metric was probably the fact that there were Conservative seats at risk in Aberdeenshire and Scott...
Ivan McKee
SNP
It is important that there is a process and that the process is robust. As officials have said, the criteria for the process are available online. There is a...