Kate Forbes

Setting out the overall approach to tax policy and delivery, the Framework for Tax looks at how devolved powers are used to achieve Programme for Government commitments and inform decisions taken over the course of this Parliament.

People, businesses and organisations are being asked for their views on the operation of the Land and Buildings Transaction Tax (LBTT) Additional Dwelling Supplement (ADS). This is the first stage in the review of the Additional Dwelling Supplement announced in the 2021-2022 Programme for Government.

An evaluation of Scottish Income Tax in 2018-19, the year in which the present five-band system was first introduced, has also been published. It shows that decisions on income tax raised additional revenue for the Scottish budget in 2018-19, “made the tax system more progressive”, and ensured that 56 per cent of taxpayers paid less tax than they would have if they lived elsewhere in the UK.

Finance Secretary Kate Forbes said: “Publishing Scotland’s first Framework for Tax demonstrates our commitment to open government, transparency and collaborative working. It sets out how the Scottish government’s approach to tax policy and how we make decisions helps to inform our priorities for this Parliament.

“Tax impacts us all and so we have worked collaboratively with partners to develop an open and transparent framework that is accessible to everyone. This will help people across Scotland know how their tax contributions will help us recover from the pandemic and build a greener, fairer, more prosperous Scotland.

“Our progressive approach to taxation in Scotland has helped protect lower and middle earners, while raising additional revenue to invest in vital public services and our economy. Unfortunately our economy continues to be affected by UK government immigration policies, resulting in a 3-5 per cent drop in our working age population. However, we will continue to build on our work delivering progressive tax policies that benefit us all.”

Charlotte Barbour, director of taxation at ICAS, said: “The Framework for Tax is helpful in setting out the Scottish government’s policy approach to the devolved and local taxes. The document is concise, well written and has useful graphics. In previous submissions we have called for a document such as this and we welcome this publication.”