IFS report shows Scotland’s tax and benefits are fairer than in the rest of the UK

by the SNP
Posted on
2 years ago
3 min read

The Institute of Fiscal Studies, the UK’s independent economic research institute, published a new report which concludes Scotland’s tax and benefits system is more progressive than the rest of the UK.

Here’s all you need to know.

Scotland has a fairer tax system

After the devolution of some tax powers in 2017, we’ve made the Scottish income tax system fairer – so that those with the broadest shoulders pay a bit more, while the majority of Scots pay less.

At the latest Budget, we’ve increased the higher and top rates of tax by a penny, which will help raise an additional £1 billion for our NHS.

Over 50% of taxpayers pay less income tax in Scotland than they would elsewhere in the UK – and even the Tory Scottish Secretary Alister Jack admitted it.

Scotland’s reforms are putting more money in the pockets of those who need it most

By asking those on the highest incomes to pay a bit more tax, not only are we able to raise more money for our NHS, but also ensure that those on the lowest incomes will have more money in their pockets.

Thanks to the new benefits and top-ups introduced by the Scottish Government, by April 2023, the incomes of the poorest tenth of Scottish households will be £580 higher per year than they would under the system in England and Wales.

And decisions we took in our 2023-24 Budget mean that we’re delivering record spending on tackling child poverty.

Delivering a better deal for families with children

Our transformative anti-poverty policies such as the Scottish Child Payment – which doesn’t exist elsewhere in the UK – are making a real difference.

In the space of just 8 months, in 2022, we have raised the Scottish Child Payment by 150% – from £10 to £25 per week per child.

As a result of the Scottish Government’s tax and benefit reforms, amongst the poorest 30%, the incomes of households with children are on average £2,000 higher per year.

The IFS research economist Tom Wernham said: “The Scottish Government has used devolved income tax and benefit policy to make the system more progressive, as well as to raise more revenue to fund public services. These changes imply big increases in income for poorer households with children.”

Scotland is choosing a different path to austerity-obsessed Westminster

Almost 13 years of Westminster austerity policies, imposed on Scotland against our will, had a devastating impact on people, livelihoods and communities.

Decisions of Tory governments, which Scotland hasn’t voted for since the 1950s, led to over 300,000 excess deaths and pushed thousands of people into poverty.

That’s even before the impact of Brexit is considered – a hard Brexit, backed by the Tories and Labour, which damages our businesses, jobs and has sent Britain to the bottom of economic growth league tables.

As we continue to pay the price of Westminster governments, Scotland is already charting a better, fairer future by helping those on the lowest incomes and building a social security system based on dignity and respect.

If we can do so much with limited powers and resources, imagine how much more we could do with the full powers of a normal, independent country. A better future is possible – and the power to help build it is in your hands.

If you haven’t already, join over 500,000 people in Scotland and pledge your support for Scottish independence.