Scotland enters brave new tax world

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Donald Drysdale comments on the new fiscal framework negotiated between the Westminster and Holyrood governments.

Agreement reached

After protracted negotiations behind closed doors, the UK and Scottish governments announced on 23 February that they had reached agreement on a new fiscal framework to underpin the further powers over tax and welfare now being devolved to Scotland.

‘The agreement between the Scottish Government and the United Kingdom Government on the Scottish Government’s fiscal framework’ finally reveals what has been decided.  The need for this fiscal framework was explained in our article ‘Scotland’s devolved taxes: A never-ending story’.

Tax powers

Given the slow progress of the Scotland Bill, there had been speculation about whether Holyrood’s new, wider powers over income tax rates and thresholds would be introduced in 2017 or 2018. The governments have agreed that this should happen on 6 April 2017.

The Scottish government will retain all devolved and assigned Scottish tax revenues. Revenues from tribunals and courts in Scotland will be retained by the Scottish government from April 2017. Air passenger duty is to be devolved in April 2018, and the devolution of aggregates levy will begin once current legal issues relating to state aid and other matters have been resolved. The assignment of VAT revenues will be implemented in 2019/20.

Dates for devolution of welfare responsibilities have still to be agreed by the Joint Ministerial Working Group on Welfare, which was set up last year by the UK and Scottish governments.

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Donald Drysdale
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07th Mar 2016 13:01

I've said it before...

... and I'll say it again:

The North Britain Regional Council (AKA the Scottish Government) needs scrapped as all it has ever acheieved is division.

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By Tromdo
07th Mar 2016 14:00

I've not said it befor

but I'll say it now.  With insight such as yours it's amazing you're not running the country.

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07th Mar 2016 14:09

Anything to add?
Attacking others posters adds nothing, and is exactly the type of post SNP supporters use when they can't come up with a valid response.

For what it's worth, I don't care who is in charge at Holyrood, all I have seen anyone achieve is division.

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07th Mar 2016 14:24

This article misses out the significant point of all

And here it is -

25.Full devolution of income tax rates and thresholds for non-savings and non-dividend income will therefore commence in April 2017.So an employer in Berkshire with employees who live in Scotland, or who lived in Scotland for more than 6 months before moving to the rest of the UK, or who lived in the rest of the UK for less than 6 months before moving back to Scotland will not just have to record the 'S' prefix to the code number but could be required to apply quite different allowances and tax rates! Madness this way lies...

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07th Mar 2016 14:53



That's the sort of division (and complexity) that having separate layers of Government causes. It also increases the ability for HMRC to screw up by making their job more complex; and that's something nobody wants.

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08th Mar 2016 09:15

its complicated

Extract above


Changes in the Scottish block grant will continue to be determined in accordance with the Barnett formula, a non-statutory convention adopted as a ‘temporary’ measure in 1978. 


This will end in tears.

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