Tax traps

There is nothing new here. The SNP has been totally consistent in backing a UK-wide 50p income tax rate. This statement from more than a year ago makes the party’s position perfectly clear.

We back the 50p top rate of tax across the UK, but to do it in Scotland alone could put millions in revenues at risk.

If just seven per cent of top rate taxpayers change their tax arrangements the Scottish Government could lose £30 million in revenues in a single year, putting the funding of our public services at risk. The Scottish Government has published a policy analysis of the impact of making changes to the additional rate in Scotland only, which you can read here.

The additional rate will not increase in 2017/18, but analysis will be updated each year to inform decisions in future budgets.

The British parties will, of course, present this as some sort of U-turn by the First Minister. And the old criticisms of the SNP’s position on the 50p tax will be milked for all they’re worth. In reality, this is a very good example of the principled pragmatism that has made the SNP the voters’ choice for a decade now.

The party supports the 50p rate in principle. But, for purely practical reasons, cannot introduce it in Scotland. Surely it’s not that difficult for Patrick Harvie and other to understand that it would be grossly irresponsible to implement a measure which the best calculations available indicate would cost the nation £30 a year. There is a place for gesture politics. But that is a very expensive gesture.

This issue also illustrates the perils of a devolution settlement motivated, not by any desire to improve the governance of Scotland, but by an overarching imperative to undermine the Scottish Government, weaken the Scottish Parliament and generally cause problems for the hated SNP.

Devolution has always been about withholding powers that should rightly lie with the Parliament which is actually elected by the people of Scotland. Latterly, it has come to be concerned mainly with setting political and fiscal traps for the SNP administration.

For all policy purposes, a nation’s tax/benefit arrangements have to be considered as a single coherent system. Having partial control of parts of the system is just about the worst way of organising things. A situation which is only aggravated by having control divided between two administrations with very different priorities.

Devolution is no longer merely unsatisfactory in constitutional terms. It is now seriously detrimental to Scotland’s interests. It has become a weapon in the hands of British nationalists determined that the Union should be preserved at any cost to the people of Scotland.

Scotland’s tax/benefit system should be shaped in accordance with the needs, priorities and aspirations of Scotland’s people. This will only happen when we bring our government home.

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2 thoughts on “Tax traps

  1. TheStrach

    Exactly. We’ve been given just enough new powers to try and trick the SNP into taking decisions which will hurt Scotland.

    The SNP are too smart to fall for that. I don’t know why the Greens can’t see that Scotland would suffer if they did introduce a 50p tax rate.

  2. grizebard

    “… when we bring our government home”

    What a lovely way to put it. Peter. That’s one which deserves to be repeated. A lot.

    The Smith Commission was a tawdry political fix with an outcome expressly designed by the colluding Unionists to produce traps for the Scottish Government. Hence Rude Gal’s chagrin that the SNP are astute enough to have avoided them all.

    But back to the real election, the Tories have pitched their manifesto (the real one, not the fake “Scottish” one) to give them room for an income tax hike. What new changed tune will Ruthless play when that happens?

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