Scotland ‘will not replicate UK tax cuts’ as emergency budget review launched
THE Scottish Government has ruled out tax cuts, despite pressure to follow Westminster's example.
The UK chancellor's mini-budget saw a 1p cut to the basic rate.
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This will mean that from next April no one in Scotland will pay less tax than their counterparts south of the border - and those earning over £14,732 will pay more.
Kwasi Kwarteng also scrapped the top rate of tax on earnings over £150,000 with a massive gap set to emerge between those in Scotland and UK.
The SNP Government has faced calls to replicate the cuts south of the border, however that has been ruled out.
Mr Swinney said: “The Chancellor’s statement provided little respite for many families who are already facing a winter unable to afford essentials like food and heating.
“The UK Government needed to use its reserved powers to help those who need it most – but instead we got tax cuts for the rich and not much for anyone else.
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“The Chancellor is taking a huge gamble on public finances and the health of our economy.
"And the markets have reacted strongly – the pound fell to record lows on Monday, the cost of government borrowing has risen to its highest level in over a decade and investor confidence is plummeting.
“The Scottish Government is doing everything within its powers to support people, public services and the economy but these efforts are under threat by the UK Government’s new and dangerous race to the bottom.
"That is not a race we are willing to run.
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“We will not be replicating the UK Government’s tax cuts but will consider carefully the correct measures for Scotland.”
It comes as Deputy First Minister confirmed it was holding an Emergency Budget Review (EBR).
It will be informed by a panel of experts, including economists who will study the impact on Scotland of the UK Chancellor’s fiscal approach.
Mr Swinney told the Scottish Parliament that further time was required to consider the implications of the UK Government’s tax changes and he would report the results of the review in the week beginning 24 October.
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The EBR will outline how resources will be redirected to tackle the cost of living crisis.
In light of the UK Government’s mini-budget last Friday and the significant economic instability which has followed, advice will be sought on the implications for Scotland.
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