From: Ajawas@novo.net   
      
   SNP plans ‘will force income tax to double’   
      
   "Another report drawn up for Scottish Labour suggested that the price of   
   a barrel would need to rise from its current $60 to $200 for Scotland to   
   break even.   
      
   Scottish Secretary David Mundell said the Scottish Government’s   
   reluctance to press ahead with fiscal autonomy could be explained by the   
   fact that the basic rate of income tax in Scotland would need to more   
   than double to cover the near-£10bn gap identified by the IFS."   
      
   ============   
      
   FINANCE secretary John Swinney would have to “more than double” income   
   tax north of the Border to fill the financial black hole created by the   
   introduction of the SNP’s plans for full fiscal autonomy, the UK   
   government has warned.   
      
   The claim was dismissed as “ludicrous” by SNP deputy leader Stewart   
   Hosie but was based on a £10 billion annual funding gap identified by   
   the UK’s leading independent economic think tank, the Institute for   
   Fiscal Studies (IFS). The Scotland Office made its calculation as HMRC   
   released its report into identifying the number of Scottish income tax   
   payers for new powers set to be introduced next year, which will see the   
   beginning of an official Scottish rate of income tax.   
      
   The row broke out as the SNP’s 56 MPs have been publicly dared to back   
   an amendment by Tory grandee Sir Edward Leigh to the current Scotland   
   Bill on further devolution which would deliver full fiscal autonomy for   
   Scotland. Sir Edward’s amendment was compared by critics to one put down   
   by the SNP which was described as “a fudge designed to ensure that   
   Scotland would never get full fiscal autonomy”.   
      
   Full fiscal autonomy would mean Holyrood was responsible for all tax and   
   spending while it paid a supplement to Westminster for defence, foreign   
   affairs and servicing the national debt.   
      
   The issue looks set to be debated in the committee stage of the bill on   
   Monday against the background of a report by the independent Office for   
   Budget Responsibility (OBR) which said that oil and gas revenues will be   
   virtually wiped out as a significant tax take, with an expected £2bn   
   coming into the Exchequer between 2020/21 and 2040/41 instead of the   
   previous estimate of £37bn.   
      
   The OBR claimed while the expected revenues were much lower because of   
   the dramatic fall in the price of a barrel of oil, a rise in the price   
   would still leave “minimal” tax revenues because of the cost of   
   decommissioning former oil and gas fields.   
      
   Highlighting an admission by Mr Swinney that he could use powers already   
   agreed for Holyrood and due to come in next year to raise income tax, Mr   
   Mundell said: “The onus is now on the Scottish Government to tell us   
   what the new rate is going to be. John Swinney has already confirmed   
   that he is considering increasing tax.”   
      
   He went on: “If full fiscal autonomy were ever to happen then the basic   
   rate of income tax in Scotland would need to more than double to keep   
   spending at current levels.   
      
   “Even the First Minister now accepts that fiscal autonomy would be a   
   burden for Scotland to shoulder. They are demanding something they don’t   
   want so that they can complain when they don’t get it.”   
      
   Mr Hosie described the claims as “ludicrous”. He said: “The UK had a   
   deficit of around £75bn in the most recent financial year – so by his   
   bizarre logic, Westminster would have had to raise taxes by £75bn in a   
   single year to be financially viable.   
   [...]   
      
   http://www.scotsman.com/news/politics/top-stories/snp-plans-will   
   force-income-tax-to-double-1-3801144   
      
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