Finance Secretary for Scotland announces income tax changes in Scottish Budget

In his draft Budget, Derek Mackay, the Finance Secretary for Scotland, has unveiled a series of changes to the Scottish income tax rates and bands.

Mr Mackay used the Scottish Budget to confirm an increase in income tax rates for higher earners, together with the introduction of two new income tax bands.

Image result for income tax changes in Scottish BudgetThe changes will see the higher rate of income tax increase from 40p to 41p, with the top rate rising from 45p to 46p.

Meanwhile, those earning more than £24,000 a year will be taxed under a new 21p band, and a ‘starter’ rate of 19p will also be introduced.

In addition, the Finance Secretary confirmed that Land and Buildings Transaction Tax (LBTT) will be maintained at its current rates, and announced the introduction of a new relief for first-time homebuyers purchasing property worth up to £175,000 in Scotland.

Commenting on the Scottish Budget announcements made by Mr Mackay, Hugh Aitken, Director of the Confederation of British Industry in Scotland (CBI Scotland), stated: ‘By putting productivity at the heart of the Budget, it’s clear that Derek Mackay has listened to organisations like the CBI that have said consistently that boosting productivity is the only sure-fire way to grow our economy, generate the revenues we need for quality, sustainable public services and raise living standards.

‘But things aren’t all rosy – the prospect of income tax rises and added complexity in Scotland’s tax code will be a bitter pill to swallow.’

The Scottish Budget announcements can be read in full here.

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