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Scotland to be handed income tax autonomy in post-referendum deal

The Scottish Parliament will be handed complete autonomy over setting income tax north of the border in a deal agreed by the Smith Commission, Sky News reports.

The commission, led by Lord Smith, has been investigating how to increase the powers of Holyrood in the wake of the Scottish independence referendum.

Smith is due to publish his recommendations and, according to Sky News, the report will recommend:

  • Powers over income tax bands and rates being handed to the Scottish Parliament – although tax on unearned income and the personal allowance will remain under Westminster control;
  • Pensions and child benefit will continue to be the UK Government’s responsibility
  • On welfare, Holyrood will be given control over certain individual benefits, such as attendance and carer’s allowance, cold weather payments and winter fuel allowance.

The publication of the eagerly anticipated report comes after the No campaign secured a narrow victory in the September plebiscite.

Following the vote, the Conservatives, Labour and the Liberal Democrats promised major reforms so the Scottish Parliament has greater power in deciding how the country is governed.

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  1. There will problems ahead as Scottish MP’s will be able to vote on income tax in England but English MP’s will not be able to vote on income tax in Scotland. Pension contributions tax relief North will be different to the South. A federal Britain in the making

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