Income Tax Powers 'In Place By 2017'

6 October 2015, 09:09

New income tax powers for the Scottish Parliament should be in place in 2017, according to the Scottish Secretary.

David Mundell said the UK Government would like to see the new powers, contained in the Scotland Bill, come into force "as soon as possible''.

The Scotland Bill, which is currently before the UK Parliament, was brought forward to implement the recommendations of the post-referendum Smith Commission and gives Holyrood 10% of VAT revenues, increased power over welfare spending and control over income tax rates.

The Scottish and UK governments are in discussions over the terms of a fiscal framework to take account of the increased powers.

Mr Mundell will tell the Conservative Party conference in Manchester that the UK Government is keen to see Holyrood's new income tax powers commence in 2017 - earlier than had been expected.

It could make taxation a major issue in next year's Holyrood election campaign as the Scottish Government elected in May would have to set out its plans for the new powers in its first Budget.

Mr Mundell will say on Wednesday: "Because we know that the new tax powers are at the heart of the devolution package in the Scotland Bill, we want them to come on-stream as soon as possible. I would like that to be in 2017.

"The final date for the transfer will be agreed between both of Scotland's governments as part of the fiscal framework negotiations, which are on-going. But we think 2017 is an achievable and desirable time for these new powers to take effect.

"It would mean that the Scottish Government elected next year would have to include plans for these new powers in its first budget.

"So when people in Scotland go to the polls next year, the parties will need to present their plans for income tax. And they'll need to be honest about what they will mean for Scottish taxpayers.''

The Scottish Government has said it would not support a deal that risks leaving Scotland "worse off''.