Scottish budget: ScotGov announce tax increases and spending plans for the coming Financial Year
The Deputy First Minister and Finance Secretary, Shona Robison, published the Scottish Budget for the next financial year (2024/25) on 19th December 2023.
You can read the full statement delivered to the Scottish Parliament at: Budget Statement, or watch it online here.
A number of announcements are of relevance to our sector. In summary:
Business Rates - There will be a freeze on poundage for the basic property rate (businesses with a ratable value up to and including £51,000). The Small Business Bonus Scheme will be maintained (providing 100% relief to approximately 100,000 properties). However, consequentials from the UK Government’s 75% relief for Retail, Hospitality & Leisure will not be passed on to Scottish businesses by ministers this year.
Tax – A new 45% ‘Advanced Rate’ income tax will be introduced for people earning between £75,000 and £125,140. While the top rate of those earning over £125,140 will increase by 1p to 48p. Council tax rates will also be frozen in the upcoming year.
Crime and Justice - SG will invest £1.55bn in policing in 2024-2025, increasing the policing and resource budget by 5.6% (£75.7m).
In addition, the Scottish Government will provide £358m for energy efficiency upgrades and installation of clean heating systems and provide £49m for the transition towards a circular economy.
It is widely reported today that the Fraser of Allander Institute has calculated that the Scottish Government is now facing a funding shortfall of around £1.5bn.