THE SNP have challenged Scottish Labour MPs to “stand up to Keir Starmer” on the National Insurance tax hike.
It comes ahead of a House of Commons debate on the impact of the UK Budget on Scotland, which will take place on Tuesday. Last week, a poll found that more in eight in 10 Scots do not think Scottish Labour's Anas Sarwar stands up to Starmer for Scotland.
The call follows a joint letter from Scotland’s First Minister John Swinney and the president of local authority body Cosla, Shona Morrison, to Rachel Reeves warning current UK Government plans fall far short of the funding require to compensate Scottish public services.
Reeves previously announced the rate that employers pay in contributions will rise from 13.8% to 15% on a worker’s earnings above £175 from April while the threshold at which employers start paying the tax will be reduced from £9100 per year to £5000.
Swinney and Morrison’s letter has been backed by 48 organisations from Scotland’s public and third sector, including trade unions and charities.
It warned the tax hike could cost Scotland’s public sector £700 million.
Commenting ahead of the Westminster debate, SNP economy spokesperson Dave Doogan said: “It’s time for Scottish Labour MPs to finally stand up to Starmer and demand the UK Government fully compensates Scotland’s public services for the Labour Party’s National Insurance taxes.
"Voters in Scotland were promised change but instead they have been short-changed by Scottish Labour MPs who voted to take away the winter fuel payment and increase National Insurance taxes, which could cost Scotland's public services £775m.
"They must stop making excuses for Keir Starmer, and instead join the broad coalition of Scottish public sector organisations, charities and trade unions demanding full compensation."
Meanwhile, the British Chambers of Commerce warned on Monday that businesses are cutting back on investment and raising prices in response to the tax hike.
A survey of more than 4800 organisations found business confidence has “slumped” to its lowest level in two years following the Budget, with two thirds worried about the tax hike and 55% planning to raise prices as a result.
Director general of the BCC Shevaun Haviland warned “firms of all shapes and sizes are telling us the national insurance hike is particularly damaging” and that “businesses are already cutting back on investment and say they will have to put up prices in the coming months”.
The National has approached Scottish Labour for comment.
