Scottish Conservatives want to cut taxes for higher earners, Ross confirms
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Douglas Ross has defended the Scottish Conservative’s manifesto pledge to reduce income tax for higher earners.
Scotland’s higher income tax rates and thresholds for 1.1 million Scots would be scrapped “when public finances allow”, according to the Tories’ manifesto.
There are six income tax bands in Scotland compared to four in the rest of the United Kingdom.
Workers in Scotland who earn less than £25,297 pay the same or lower income tax than other UK nations.
But the intermediate rate of 21%, the higher rate of 41% and the top rate of 46% are all 1% higher than other parts of the UK.
The Scottish Conservatives’ manifesto states: “By the end of the Parliament, we would seek to ensure that Scottish taxpayers do not pay higher income tax than those in the rest of the UK, while retaining the starter rate for low earners.”
The proposal would therefore abolish the intermediate rate and increase the £43,663 annual earnings threshold at which people start paying the higher rate to match the UK Government’s level of £50,271.
It would also lower the higher and top rates of tax to 40% and 45% respectively.
Despite claims that the manifesto is fully costed, a document released by the Scottish Conservatives does not give projections for the impact on tax revenue raising the higher rate, tax threshold would have.
The costings document states: “In the event that tax revenue outstrips public spending demands, then we would seek to realign income tax rates and bands with the rest of the UK, while retaining the starter rate.”
It is our aspiration to get parity back in the tax system
Asked about the proposal, Mr Ross said: “We make it clear that it is our aspiration to get parity back in the tax system.
“People understand, I think, that’s not something we can do immediately given the economic issues we are facing as a country, it will take time to recover our economy and rebuild after Covid.
“But we have said, as we see the budget for Scotland and the income from taxation, if we get to a stage where that is higher than our spending, then we would seek to restore the parity and our taxation system here in Scotland to help 1.1 million Scots who are paying higher tax here in Scotland compared to other parts of the country.”
He added: “This is a proposal we would seek to deliver once we’ve got Scotland’s economy back up and running and, being honest, I’m not saying this is something we would bring forward on the first day of a five-year parliament.
“It’s something that would come after our investment in infrastructure in the NHS in education, and on all the areas that people are really focused on.
“But it’s also something that would benefit 1.1 million workers in Scotland, 1.1 million people who pay more tax to do the same job than elsewhere in the United Kingdom, while protecting those who are on the lowest earnings.”
The Scottish Liberal Democrats, whose manifesto states the party “do not propose substantial changes to the rates and bands of Scottish income
tax”, said the Tories’ plans would give Douglas Ross and all MSPs a £1,321 tax cut.
Alister Carmichael, the party’s Orkney and Shetland MP, said: “It is the wrong priority for Scottish Conservative MSPs to give a tax cut to each other.
“Each Conservative MSP will save £1,321 under their own proposals.
“Douglas Ross is promoting a Ross Rebate for himself at a time when we know the health service is struggling to cope with the crisis.
“The Conservatives have offered NHS workers a paltry 1% pay rise. But Douglas Ross will get an increase of double that just by his own tax proposal. This doesn’t even include the additional salary he will get for being both an MSP, an MP and a referee.
“Tax cuts for high earners should not be the priority as we put recovery first.”
SNP depute leader Keith Brown added: “Today’s Tory manifesto shows that behind their rhetoric, these are the same-old Tories – completely out-of-touch, planning tax cuts for the rich and austerity for everyone else, and only interested in widening the gap between rich and poor in our society.
“It is shameful that rather than taking on the millionaires that fund their party, the Tories are instead ruthlessly focused on attacking those on lower incomes – giving their millionaire chums a tax cut, which Douglas Ross himself would benefit from, while those on low wages get nothing.”
