New tax powers coming to the Scottish Parliament

Today sees a milestone in the transfer of £12 billion worth of income tax powers from Westminster to Holyrood under the Scotland Act 2016. The UK government will make the formal Parliamentary orders which confirm that landmark new income tax powers will transfer to the Scottish Parliament. As a result, from April next year, Holyrood will control income tax rates and thresholds. The move, on St Andrew’s Day, comes two years on from the publication of the Smith Commission’s report which, in the wake of the 2014 independence referendum, recommended which powers should transfer to Holyrood from Westminster. The Scotland Act 2016 took forward the report’s recommendation in full. Scottish Secretary David Mundell said: “Through the Scotland Act 2016 and, most recently, the Autumn Statement, the UK Government has provided more powers and more funding for Scotland. It’s now over to the Scottish Government to set out how it plans to use these powers to drive jobs and growth in Scotland.” From 6 April 2017, Holyrood will have the power to:

First Minister Nicola Sturgeon has already indicated that her government will not pass on tax cuts proposed at Westminster for the highest bands.