Scottish Budget widens tax differential with rest of UK

The difference in the level of tax paid by higher earners in Scotland and those living elsewhere in the UK has been increased by the Scottish Budget. Finance Secretary Derek Mackay
declared that "now is not the time" to cut taxes for the better off as he declined to pass on the break for those on higher tax rates that Philip Hammond announced in the UK Budget in October.

Mr Mackay froze the threshold at which income tax is levied at the higher rate at £43,430, while only the starter and basic bands were raised in line with inflation. According to the opposition Conservatives, this means Scottish taxpayers earning over £50,000 a year will pay £1,500 more than those in England. 

A key plank of the SNP's policy is that all those earning under £27,000 - 55% of earners - pay less tax than those living elsewhere in Britain. However, according to economists at the Fraser of Allander Institute, their gains are only marginal, worth little more than £20 a year at most.