Labour is planning an immediate 1p tax increase which would hit 2.5 million taxpayers in Scotland, including almost half a million pensioners. At a time when many families are already struggling to make ends meet, that just can’t be right.
The SNP Government is committed to fair and progressive taxation, and that principle will be at the heart of our plans for a third term in office.
Labour are shifting the burden of Tory austerity on to ordinary working people
Labour’s plan is to increase income tax for all taxpayers in Scotland this year. According to their own figures, the tax would hit three out of every four workers. A newly-qualified nurse would pay £112 more; a probationer teacher would pay an additional £116 and a new police officer would £129 a year more. Someone on an average full-time salary would add £164 more to their annual household bills. These are the people Labour expect to bankroll Tory austerity.
Labour’s proposal has the support of less than 1 in 3 of the electorate – and support is even lower among those who are least able to afford it. A poll for STV shows that of those living in the most deprived areas, only a quarter back Labour’s tax hike.
You can calculate how much workers would pay under Labour’s plans by using the Scottish Parliament information Centre tool.
Labour haven’t bothered to explain how their half-baked ‘rebate’ would work
The fact that Labour need to offer a rebate to the lowest earners to compensate for their tax hike is an admission that their policy hits the lowest paid. And, pensioners were only added into this rebate scheme on the morning the policy was announced, after the SNP had pointed out that almost 500,000 pensioners will be hit with increased taxes.
However, Labour are unable to explain how their half-baked scheme would work. To start, they haven’t explained what powers the Scottish Parliament has to deliver the scheme. The powers needed will only become available after the Scotland Bill comes into force next year.
Labour also haven’t provided detail on how the scheme would be administered, whether the rebate itself would be taxable or what impact this would have on other benefits like tax credits. Crucially, about one in three people entitled to certain benefits don’t claim them, according to UK Government figures. If this average level of uptake were maintained, around 350,000 people on low incomes wouldn’t get a rebate. These people would be caught between Labour’s tax hike and Tory cuts.
We are committed to fair and progressive taxation
We will set out how we intend to use new tax powers ahead of the election – and fairness and progressivism will be at the heart of our plans – but in the meantime, the idea of raising taxes across the board is completely unacceptable and entirely regressive.
While Labour want to increase how much they pay, we will use our budget to help people on low incomes – by rolling out the Living Wage across the social care sector, fully-funding a freeze on council tax increases and supporting low paid public sector workers.