Budget is investment for Islands says MSP

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Western Isles MSP Alasdair Allan has welcomed the passing of the Scottish Government’s budget in Holyrood.

He commented: “I’m delighted that the Scottish Government’s Budget has now passed in Parliament.

“This is a budget which not only stimulates our economy, but works to progress a fairer society in Scotland, with increased funding for the NHS and protection for low and middle income earners.

“This budget is an investment in our islands.

“The Scottish Government’s budget will deliver lower income tax for 70% of Scots - with every worker earning less than £33,000 paying less in tax next year – while protecting our public services with a modest increase for higher earners.

“This budget brings an additional £400 million to NHS Scotland, delivers a pay rise for public sector workers, £756 million for affordable homes, a £4 billion investment in infrastructure, including in superfast broadband, as well as significant investments in research, education and childcare.

“In the face of massive Westminster cuts, ongoing Tory austerity and a damaging hard Brexit – this budget provides investment to seize the opportunities of tomorrow.”

Change to tax system

The most significant change in the budget is the move to a five-band income tax system.

Scotland currently has three income tax bands - a 20p basic rate, a 40p higher rate kicking in at £43,001 and a 45p additional rate for earnings over £150,000.

However this budget has redesigned that system by adding a 19p “starter” rate and a 21p intermediate rate, while adding 1p to the higher and additional rates to create a five-band system.

The new starter rate, combined with the increase to the tax-free allowance, means many Scots will actually pay less than they do in the coming financial year than they do right now.