There has been a lot of discussion recently about whether the Scottish Parliament would be granted more powers in the event of a ‘no’ vote in this year’s Independence referendum.
This government has already overseen the biggest transfer of financial powers to the Scottish Parliament in history, and 4 further major financial changes will happen in April 2015 and April 2016.
Today in a speech to the Scottish Chambers of Commerce, Deputy Prime Minister Nick Clegg addressed the issue of further devolution of powers, saying that “‘no’ to leaving the UK and the EU does not mean ‘no’ to more change”.
He added: ‘All three parties are clear in their commitment - more powers will come.”
And last week, Prime Minister David Cameron said: “all the political parties that support the United Kingdom - Labour, Liberal Democrats and Conservatives - believe there are opportunities for further devolution [of powers]. Obviously people want to be certain it will happen and I would say it has happened in this parliament. If I’m Prime Minister in the next parliament it will happen in the next parliament.”
Here’s a rundown of the 4 new financial changes happening in April 2015 and April 2016.
1. Stamp duty land tax and landfill tax
From April 2015, Scottish government legislation will replace stamp duty land tax and landfill tax in Scotland with the Land and Buildings Transaction Tax and Scottish Landfill Tax.
Revenue Scotland will become responsible for the collection of the new taxes.
2. Extending borrowing powers
From April 2015, current borrowing powers of up to £500 million will be extended and a new Scottish cash reserve will be created to help manage the new tax receipts.
3. New capital borrowing power
From April 2015, there will be a new £2.2 billion capital borrowing power for the Scottish Parliament, with a limited version of the power in place from April 2013 to allow the Scottish government to fund £100 million of pre-payments for the Forth Road Crossing.
4. Scottish rate of income tax
A new Scottish rate of income tax will come into force in April 2016. This means the Scottish Parliament will set a new Scottish rate – with no upper or lower limit - which will apply equally to all of the reduced main UK income tax rates.