Number of taxpayers subject to Scottish higher rate of tax set to top 550,000 in the next parliament

Our estimates show that if Scottish policy follows the rUK policy of freezing income tax thresholds the number of taxpayers subject to the Scottish higher rate and additional rate of tax will top 550,000 in the next parliament. If the Scottish Government chooses to increase thresholds in line with inflation, the median Scottish income taxpayer would pay around £195 less in tax in 2025/26. But the Scottish budget would be worse off in 2025/26 by over £700m.

Rishi Sunak UK budget

UK Budget 2021 and implications for Scotland

This was a budget of two parts – more spending in the short term to support mitigate the impacts of covid restrictions, and future fiscal tightening to address concerns about fiscal sustainability. But what were the implications for Scotland?