Income Tax changes criticised

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The Scottish Government has been accused of steering the country into unchartered economic waters with its changes to Basic Rate of Income Tax.

Andy Willox, Federation of Small Business Scottish policy convenor, said: “We wanted to see a Scottish Government budget which offered firms a little ballast in choppy market and political conditions. Instead the Scottish Government has chosen to steer us into uncharted economic waters.”

According to the Daily Telegraph “Scottish Borders Council warned workers living in its local authority area would ‘migrate into England’ and predicted business would also look to move elsewhere to avoid their staff being taxed more”.

Scottish Finance Secretary Derek Mackay, also faced criticism from Borders Conservative MSP Rachael Hamilton who said that his budget announcement meant an increase in income tax for all those that earn over £26,000.

The SNP, however, insist said that the only those over £33,000 would pay more - but that doesn’t take into account the Personal Allowance introduced by the UK Government to help lower earners.

Ms Hamilton said: “The SNP have broken their manifesto commitment and increased the Basic Rate of Income Tax.

“This will mean that hard-working families, nurses, teachers, police officers and GPs in the Borders will have to pay more under this Nat tax.

‘The SNP promised that they would not increase the rate of income tax and now they have.

“In the Scottish Borders this could mean that some choose to live across the border to avoid this damaging increase in tax.

“The large business supplement remains twice the amount of that in England, damaging Scottish tourism in the Borders whilst it does.”

Andy Willox, added: “A majority of those in business in Scotland were against changes to the income tax regime. However, the Cabinet Secretary underlined that his tax changes were designed to cause minimum economic disruption. Our members have a real concern about the effect of these changes on household spending power.

The finance secretary said the changes - which will raise an extra £164m - were needed to “mitigate UK budget cuts, protect the NHS and public services, support the economy and tackle inequality.”