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Thursday, December 14, 2017

Nicole Sturgeon introduces Tartan tax !

Gavin Mark Hamilton  debuted in Test No. 1471  in Nov 1999, against South Africa.  In both the innings he was caught by Pollock off Alan Donald for duck and did not take any wicket, and was dropped.  But later went on to play 38 One dayers for Scotland, scoring in all the matches in 1999 WC !

Scotland is part of the United Kingdom and covers the northern third of the island of Great Britain.It shares a border with England to the south, and is otherwise surrounded by the Atlantic Ocean, with the North Sea to the east and the North Channel and Irish Sea to the south-west. In addition to the mainland, the country is made up of more than 790 islands.  The Kingdom of Scotland emerged as an independent sovereign state in the Early Middle Ages and continued to exist until 1707. Scotland subsequently entered into a political union with the Kingdom of England to create the new Kingdom of Great Britain. Within Scotland, the monarchy of the United Kingdom has continued to use a variety of styles, titles and other royal symbols of statehood specific to the pre-union Kingdom of Scotland. In 1997, a Scottish Parliament was re-established, in the form of a devolved unicameral legislature comprising 129 members, having authority over many areas of domestic policy. Scotland is also a member of the British–Irish Council, and sends five members of the Scottish Parliament to the British–Irish Parliamentary Assembly.

Tartan is a pattern consisting of criss-crossed horizontal and vertical bands in multiple colours. The Scottish variable rate (SVR) was a mechanism which would have enabled the Scottish Government to vary (down or up) the basic rate of UK income tax by up to 3p in the pound. The power was never used (and indeed was allowed to lapse by the Scottish Government in 2007. When legislating for the Scottish Parliament, a number of matters were reserved by the UK Parliament at Westminster. One such reserved matter was taxation; however, this had been a key point in Scottish negotiations relating to parliamentary control. As a means of compromise, Westminster afforded the Scottish Parliament the ability to vary income tax, which was subsequently given the consent of the Scottish electorate in the second question of the 1997 devolution referendum.

Therefore, the Scotland Act 1998 granted the Scottish Parliament the power to vary income tax by ±3p in every pound. This power was often referred to as the tartan tax, a phrase first used by Conservative financier and politician Michael Forsyth as a way of attacking the power, using the idea of 'tartan' to get across the idea that it would be an extra tax on Scots alone.

Now comes the news that Nicola Sturgeon has increased income tax by 1p on earnings over £24,000 a year as she imposed a tartan tax. Her Finance Secretary Derek Mackay announced a draft budget today that included a raft of new spending promises. Ms Sturgeon earlier claimed just three in ten taxpayers would pay higher bills under the plans. Mr Mackay's budget creates a new tax band of 21p on earnings between £24,000 and £44,273, and increase the higher and top rate of income tax to 40p and 46p respectively.

Mr Mackay told the Scottish Parliament tax per head would be marginally lower in Scotland than the rest of the UK - despite everyone earning more than £24,000 paying a higher rate than those south of the border. Today's announcement is the most radical change to taxes in Scotland. Higher rate thresholds have been frozen in previous years, slightly raising taxes on the richest.  Speaking about the draft Budget, the SNP leader said the 'vast majority' of taxpayers would be 'protected' from any increase in taxes. In his Budget speech,  Mr Mackay vowed the changes he announced will make 'Scotland's income tax system even fairer and more progressive'.

The decision to increase taxes north of the border is a risk for the SNP government after it suffered major election setbacks in June this year.   Scottish Conservative finance spokesman Murdo Fraser branded the creation of a new basic rate the "Nat tax". He accused the SNP of breaking a 2016 manifesto promise pledging not to increase the basic rate of income tax for those on low or middle incomes, and called on the Finance Secretary to apologise, adding "no one will believe a word they say ever again". Ms Sturgeon hit back, saying her ministers were dealing with the 'most challenging economic and fiscal context' since devolution as a result of Conservative reductions to public spending.

With regards – S. Sampathkumar

14th Dec 2017.

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