SCOTLAND'S income tax rates for 2023/24 have been approved by MSPs at Holyrood.
While there will be no changes to the starter, basic and intermediate rates, those on higher incomes will pay more after the approval of the Scottish Government’s proposals.
The higher rate will increase to 42% – a 1% rise – charged on income above £31,092 and up to £125,140.
The top rate has increased to 47% for those earning more than £125,140.
After a parliamentary debate on the Scottish rate resolution – which must be passed at Holyrood before the stage three budget process can go ahead – MSPs approved the changes by 90 votes to two, with 28 abstentions.
Liz Smith, Scottish Tory finance spokeswoman, stressed a difference of opinion on taxation but said it would be “irresponsible” for her party to reject the plans due to the significant economic consequences it could cause.
She said: “We do have that difference of opinion but of course there is that restraining order upon us that if we were to vote against a resolution, that it does actually mean that the Scottish Government would be prevented from collecting any tax whatsoever.
“And of course, from that angle, particularly just now, that would send out an irresponsible message, because it means obviously, at a time of great economic difficulty and of people who are under the cosh with raising sufficient revenue, that is a difficult thing.
“I think it would be irresponsible to vote against it.”
Scottish Labour’s Daniel Johnson said his party would back the move, while the Scottish Liberal Democrats’ Willie Rennie said his party was “cautiously” supporting the motion.
Public finance minister Tom Arthur said the rate was set against “one of the most challenging periods for the economy” since devolution.
He said: “In the 2023/24 budget we have taken the difficult but necessary decisions to allow us to protect our vital public services upon which so many households, communities and indeed the Scottish economy relies on.”
The policy seeks to strike a balance between “ensuring there is enough money for public spending and acknowledging the challenging economic conditions facing households and businesses”, he added.
