Meeting of the Parliament 05 February 2020
I am grateful for Willie Rennie’s intervention, because I was just going to make precisely that point. He has given me a cue to do that.
I would dearly love the finance secretary to reverse his tax increases in the forthcoming budget, but I am realistic enough to know that that is unlikely. At the very least, we want no further divergence between Scotland and the rest of the UK.
At this point, we do not know what the Chancellor of the Exchequer has in mind for income tax south of the border, and we will not know that until 11 March. However, it is reasonable to expect that the thresholds will be uprated in line with inflation, which is the least that we expect from the Cabinet Secretary for Finance, Economy and Fair Work. We do not want to see the benefit of any tax cut following on from an increase in the threshold for paying national insurance—which would benefit workers in Scotland as in the rest of the UK—being clawed back by higher tax rates from the finance secretary in Scotland.
Income tax is not the only tax lever that is under the finance secretary’s control. Yesterday, we had a long debate on the Non-Domestic Rates (Scotland) Bill—we will return to it later this afternoon. We believe that the business rates system is in need of comprehensive reform. In the short term, we suggest a minimum of two measures. First, there should be a reduction, at least to the same level as is paid in the rest of the UK, in the large business supplement, which penalises Scotland by being set at a rate that is double that for the rest of the UK. Secondly, there should be retention of all existing reliefs, including the small business bonus and the reliefs whose removal is included in the Non-Domestic Rates (Scotland) Bill.
In addition, we are very clear that we would not support the imposition of any new taxes or levies in the forthcoming budget—so we say “No thank you” to any more daft ideas like the car park tax that was put forward by the Greens last year.