Much of the speculation in the build-up to the Scottish budget yesterday focused on the possibility of the introduction of yet another new income tax band for the well off. And So it came to pass.
Speaking at Holyrood yesterday afternoon, Deputy First Minister and Finance Secretary Shona Robison announced a new ‘advanced rate’ of 45 per cent for those earning between £75,000 and £125,140, meaning they will pay more tax than they currently do. Meanwhile, Scotland’s top rate of tax, levied against those earning more than £125,000, will also rise next year, by 1 per cent, to 48 per cent.
The ‘starter’ and ‘basic’ rate bands (note, not the thresholds) will increase by the level of inflation, while Scotland’s three other rates will see no increase.
Scottish income tax was devolved in 2016, giving the Scottish parliament discretion over rates and thresholds other than the personal allowance. The latest changes mean Scotland now has six tax bands while the rest of the UK has three.
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