SNP hints at huge tax hike as Humza Yousaf scrabbles to fix £1billion black hole
Humza Yousaf said the government was facing "extraordinary pressures" on its finances
Reuters
Scotland First Minister Humza Yousaf has hinted at introducing a wealth tax to help fill a £1billion black hole in his spending plans for next year.
The SNP leader said he would not rule out taxing the rich to help cope with the “extraordinary pressures” his government’s finances are facing.
He cited a recent Scottish Trade Union Congress (STUC) report which proposed raising £1.4billion by imposing a one per cent tax on the wealthiest in society.
The tax would be placed on property, pension pits and expensive possessions, and would only be imposed on those with a wealth of over £1million.
The proposed tax would affect 12 per cent of households
Jeff J Mitchell“We shouldn’t rule these matters out because we are facing extraordinary pressures,” Yousaf said.
The proposed tax would affect 12 per cent of households, who would pay £8,000 every year.
Yousaf’s comments come after his Programme for Government statement, which he gave to Holyrood on Tuesday.
He pledged to be “unashamedly anti-poverty and pro-growth” for 2024.
The First Minister promised to spend an additional £1billion on benefits next year, as well as trial a four-day work week.
Speaking to Scottish media, Yousaf said: “I want to make sure we continue to have a progressive tax system in Scotland. Those who earn the most, like politicians, should pay the most. That is my central belief.”
He ordered SNP finance secretary Shona Robinson to use tax powers to ensure the budget was part of the “most progressive tax system”.
Robinson admitted in May that the Scottish Government’s daily spending in 2024 could cost £1billion more than they currently have.
Yousaf said the extra money would allow him to tackle poverty more successfully in Scotland, something he had been critiqued for in the past, with some campaigners saying they were “bitterly disappointed” at the efforts taken so far.
Opposition parties critiqued the potential wealth tax.
SNP LATEST:
The tax would only be imposed on those with a wealth of over £1million
PALiz Smith, the Scottish Tories’ shadow finance secretary, said: “Unfortunately, judging by his depressingly predictable programme for government, the First Minister has no plans to rein in SNP spending but instead wants to introduce even more taxes to cover the black hole in his finances.”
Yousaf said that various factors would determine the final decision on tax, which will be announced in the Scottish Budget in December.
The cross-border tax gap is a point of concern for the SNP leader, who is wary that those who may get taxed highly in Scotland could consider moving to England.
The First Minister said: “If the UK Government cuts tax, for example, we will have to be mindful of the divergence that exists. That divergence is fine, absolutely fine, to a point, but we have to be careful around the behavioural impacts of any divergence.”
You may like
