Scottish budget: income tax rates unchanged but major Brexit warning

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SCOTLAND’s income tax rates will remain the same for the next fiscal year, Kate Forbes said.

The move will be greeted with relief by many Scots ahead of an increase in national insurance contributions announced by the UK government, which goes into effect in April.

But the finance secretary also issued a warning in the wake of Brexit, saying the budget presented to PSMs is lower than it would have been if the exit from the EU had not taken place.

She said: “While all other parts of the UK have been negatively impacted as a result of Brexit, the scale of Brexit is three times greater in Scotland than in London.

“We have said that Brexit will be bad for Scotland, that it will have a differential impact on our economy and as it is clear it does, which has a direct impact on our budget.

“Do not kid yourself, the budget I am presenting today is smaller than it would be if it had not been for the impact of Brexit on our economy, a Brexit that has been imposed on us. ‘Scotland against the express will of the people who live here. ”

She then announced that there would be no change to income tax rates next year.

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The starting and base rate brackets will increase with inflation, while the top and top rates will remain frozen. The policy will mean those with higher wages will not get any inflation benefits and will pay more in real terms next year than this year.

“Income tax rates next year will remain unchanged,” she said.

“The starting and basic rate brackets will increase with inflation, and the top and top rates will remain frozen at their current levels.

“Our progressive income tax policy means that the majority of Scottish taxpayers will continue to pay less tax than if they lived elsewhere in the UK, while those who earn more will pay more.”

The land and property transaction tax will also remain at the same level as the standard and lower rates of the Scottish landfill tax will increase.
The 50% reduction in business rates for retail, hospitality and leisure will continue for the first three months of the next fiscal year while small businesses pay nothing, the Scottish Finance Secretary said.

Retail, hospitality and leisure businesses, as well as those in the aviation industry, have received 100% relief from the pandemic.

Forbes said: ‘Recognizing that we have offered the most generous tariff relief in the UK over the past two years, and the importance of staggering the return of tariff obligations, tariff relief for sectors retail, hospitality and entertainment will continue at 50%. for the first three months of 2022-2023, capped at £ 27,500 per taxpayer.

“This will prevent a cliff edge for companies in these sectors, saving them an additional £ 56million in 2022-2023.”

Businesses on Mainstreets with a taxable value of less than £ 15,000 will pay nothing in tariffs for the whole year, while new construction on Mainstreets will also pay nothing in tariffs for 12 months after the occupation.

Forbes also announced that the Scottish government would be implementing a ‘minimum wage’ for public sector staff of £ 10.50 per hour.

The Finance Secretary told MSPs on Thursday: ‘Our compensation policy for next year therefore focuses on low-income people, continuing our step-by-step approach and ensuring a rise in inflation of at least £ 775 for those on low incomes. who earn up to £ 25,000, £ 700 to those earning between £ 25,000 and £ 40,000, and £ 500 to those earning over £ 40,000.

“In October, the government announced a pay hike for social workers to £ 10.02 an hour.

“Today I can announce a minimum minimum wage of £ 10.50 per hour in all bodies covered by the remuneration policy, with specific funding to apply to adult social service staff.”

She confirmed that the Scottish government will double the Scottish Child Payment in April.

Spending over £ 200million next year, the £ 20 per week allowance will be available from April and will extend to all children under 16 by the end of the year. ‘next year.

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“It is right that the government is putting all its efforts into doing this, and that means we have to make tough choices elsewhere in the budget if necessary,” Kate Forbes told MSPs.

“We are doing this in order to fund the UK’s most ambitious anti-poverty measure and to respond to the UK government’s decision to remove the £ 20 increase in universal credit.

‘This budget not only fulfills the Government’s Program pledge to double the Scottish Child Payment to £ 20 per week, but – as the Prime Minister announced last week – we will advance this pledge until April 2022.

“President, this represents almost £ 200million in next year’s budget to directly lift children across Scotland out of poverty. ”


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