Scottish Budget analysis: Income tax differences still dominate

Derek Mackay ahead of the budget. Picture: Lisa Ferguson

Income tax has dominated the Scottish budget process since the Scottish Government decided to overhaul the system and introduce five tax bands last year.

It means Scotland’s has a significantly different system from the rest of the UK, where four bands are in place.

The changes unveiled by Mr Mackay in today’s budget mean and additional 24,000 workers will now pay the Higher rate of 41pence in the pound. This kicks in at a salary of £43,430 after Mr Mackay froze this, instead of pushing it up in line with inflation.

In England, workers only start paying this rate on a salary of £50,000 and it is set at 40 pence.

However, Mr Mackay insists that 99% of taxpayers will pay no more in tax than they did last year as the personal allowance is also going up. Only those on salaries of £124,000 will actually pay more in tax in Scotland. He has not put up taxes - it is the UK