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MSPs confirm 2017-18 income tax rates

22 February 2017

Scottish rates of income tax were set by MSPs for the first time yesterday, keeping the same tax rates as in the rest of the United Kingdom but with a lower threshold at which the higher rate will take effect.

Ministers had proposed to raise the threshold in line with inflation rather than the bigger increase to £45,000 to take effect south of the border, but agreed on no change from the current £43,000 threshold as part of the deal with the Greens to ensure that the Parliament passed the budget.

The Scottish Rate Resolution passed by Holyrood sets:

  • the Scottish basic rate at 20%, charged on income (above the personal tax allowance of £11,500) up to a Scottish basic rate limit of £31,500;  
  • a Scottish higher rate of 40%, charged on income above the Scottish basic rate limit and up to £150,000; and
  • a Scottish additional rate of 45%, charged on income above that higher rate limit.

The resolution was passed by 61 votes to 55, with the six Green MSPs abstaining.

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