Scottish Budget 2025-26: an increasingly complex landscape

Shona Robison delivered her Budget for Scotland on 4 December 2024 starting with the spending commitments before moving on to the tax raising part of the Budget speech. Alongside this the Scottish government produced its Scotland’s Tax Strategy: Building on our Tax Principles document.

Overall the most interesting thing about it was that it appeared to be the first time in a few years that income tax rabbits were not being pulled out of hats. We could ask ourselves why that was the case but it seems there either was little room for manoeuvre or else the Scottish government was concerned that behavioural changes (which are now officially recorded in the Scottish Fiscal Commission’s reports as of December 2024) and resistance to further income tax rises would manifest themselves if taxpayer tolerance levels were exceeded.

Those who listened to the Budget announcement...