Rishi Sunak goads ‘high-tax’ SNP as Scots brace for MORE hikes: PM warns separatists over plans being announced in Budget tomorrow – pointing out that Holyrood has been handed RECORD funding
Rishi Sunak goaded the high-tax SNP today as Scots brace for more hikes to be announced.
Humza Yousaf’s party is due to unveil plans to increase the burden further tomorrow as they struggle to fill a £1.5billion hole in the books.
An extra income tax band is set to be created, despite fears – including from businesses and senior SNP figures – that it will drive people to leave the country.
On a visit to RAF Lossiemouth this morning, Mr Sunak pointed out that Scotland is already the highest taxed part of the UK.
He stressed that Westminster had already allocated the Scottish government its biggest ever funding settlement, adding that those north of the border will benefit from Jeremy Hunt cutting national insurance.
Rishi Sunak goaded the high-tax SNP today as Scots brace for more hikes to be announced
The financial package due tomorrow is expected to introduce a 44 per cent band in Scotland from April. It could be applied to Scots’ earnings between around £75,000 and £125,140, when the 47 per cent top rate kicks in
Humza Yousaf’s party is due to unveil plans to increase the burden further tomorrow as they struggle to fill a £1.5billion hole in the books
The PM said: ‘The first thing I’d say is the UK Government has provided a record amount of funding to the Scottish Government through the Barnett formula, so they’re ultimately responsible for the finances here in Scotland.
‘But I can tell you what we’re doing in the UK is controlling spending and cutting people’s taxes and that’s going to kick in for everyone in Scotland and across the UK, a reduction in the rate of national insurance from 12 per cent to 10 per cent from January.
‘That will save a typical person in work around £450 – it’s a significant tax cut.
‘So that’s what the UK Government is doing to help Scottish families with the cost of living, which we know is a priority for them.
‘But ultimately, it’s the Scottish Government that are responsible for their own finances – it’s already the highest taxed part of the UK and obviously it would be very disappointing to see that tax burden continue to rise in Scotland.’
The financial package due tomorrow is expected to introduce a 44 per cent band in Scotland from April.
It could be applied to Scots’ earnings between around £75,000 and £125,140, when the 47 per cent top rate kicks in.
Tories have accused Mr Yousaf of trying to ‘tax his way out’ of trouble after ‘astonishing mismanagement’ of Scotland’s finances. Critics point out that Scotland already gets significantly more funding per person from Westminster than England.
An economic think tank warned last week that the band could lose £43million in revenue in its first year from ‘behavioural impact’, including people moving away or finding new ways to protect their hard-earned pay.
The Fraser of Allander Institute (FAI) also disclosed SNP ministers are now facing a £1.5billion black hole in the finances.
A report by the institute noted a widening tax gap may have a longer-term impact on migration, with more people looking to move to other parts of the UK or abroad.
That would severely dent efforts by SNP ministers to attract workers to Scotland and damage recruitment in both the public and private sectors.
Former finance secretary Kate Forbes – who lost the SNP leadership race to Mr Yousaf earlier this year – has said she does not believe increasing income tax will necessarily bring in more money.
Former finance secretary Kate Forbes – who lost the SNP leadership race to Mr Yousaf earlier this year – has said she does not believe increasing income tax will necessarily bring in more money
Yesterday SNP finance secretary Shona Robison hit out at the level of funding available to Scotland.
‘In the face of a deeply challenging financial situation, this budget will reaffirm our social contract with the people of Scotland,’ she said.
‘The autumn statement was devastating for Scottish finances. The Institute for Fiscal Studies has acknowledged that it will lead to planned real-terms cuts in public service spending.’
But she added: ‘We refuse to follow UK Government spending decisions – indeed, we are doing all we can to mitigate them.
‘We are proud that Scotland has a social contract which ensures people are protected by a safety net should they fall on hard times.
‘This contract underpins this budget, with targeted funding to protect people and public services.’
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