Scottish Budget 2020-2021 unveiled

06 February 2020

Against a backdrop of controversy, Kate Forbes became the first woman to deliver a budget, and laid out the Scottish government’s spending plans for tax year 2020-2021.

Ms Forbes revealed that there will be no increase to any of the income tax rates for the next tax year, but that the basic and intermediate band thresholds would be increased in line with inflation. The higher and top rate thresholds will be frozen and remain unchanged. Ms. Forbes stated that this would mean that Scotland would be the place where people pay the lowest tax in the UK.



Band name


£12,501 ‑ £14,585

Starter Rate


£14,586 ‑ £25,158

Scottish Basic Rate


£25,159 ‑ £43,430

Intermediate Rate


£43,431 ‑ £150,000

Higher Rate


Above £150,000

Top Rate


Those earning more than £100,000 will see their Personal Allowance reduced by £1 for every £2 earned over £100,000, in line with current tax rules.

There was also discussion of the fact that this Scottish Budget was being delivered under strange circumstances, and that the Scottish government had been required to make certain assumptions about the Barnett consequentials coming to Scotland, in light of the fact that the UK budget will not be delivered until 11 March 2020. This wasn’t without its difficulties, but the budget could not be further delayed and was needed in order to inform councils and give an outline of the levels of spending they could come to expect for the tax year ahead.

A few areas of interest were:

  • Funding to establish the Scottish Child Payment expected to help 287,000 children by 2024-2025, costing £162 million.
  • £361 million invested in a new and improved Social Security System, which will make approximately £3.4 billion of financial support available to people throughout Scotland
  • Pay rise of up to 3% for those working in the public sector who earn £80,000 and below
  • £494 million to support government services
  • 1% of GDP will be allocated to spend on tackling climate change
  • Teachers to receive pay increase of a minimum of 13%, meaning that the starting annual salary for a fully qualified teacher would be £32,994
  • £120m for a heat transition deal and capital funding of £151m for energy efficiency infrastructure
  • An increase to the proportion of cash going to low carbon initiatives, with £1.8bn in capital investment
  • An increase of almost 60% in funding to reduce harm from alcohol and drugs
  • Funding of £15 billion for health and care services

The Budget document in its entirety can be located here.



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