Scottish Rate of Income Tax set at 10 per cent

16 December 2015

The Scottish Government has for the first time announced the proposed Scottish Rate of Income Tax for 2016-17.

The proposed rate is 10 per cent and will apply from 6 April 2016. This means that the total income tax rates that apply to Scottish taxpayers will remain the same as those that apply to taxpayers in the rest of the UK.

John Swinney, the Deputy First Minister, announced the publication of Scotland’s Spending Plans and Draft Budget for 2016-17 which rules out an increase in the first year of Scottish income tax.

The document states that “…the inflexible nature of the current Scottish rate-setting power, in that it must apply equally to all tax bands, makes it impossible for the Scottish Government to act to make income tax better reflect the taxpayer’s ability to pay. As the same rate is added to the existing UK rates minus 10 percentage points, any increase above a 10 per cent rate would have a disproportionate effect on the amount of tax paid by people on very low taxable incomes against their current tax bill, and any decrease would disproportionately benefit those people with high incomes.”