Using new powers to increase taxes on the wealthy will put Scotland "out of step" with the rest of the UK and drive potential employers away, one of the northeast's most prominent businessmen has warned.
Stewart Milne, founder and executive chairman of the £210 million-turnover construction firm Stewart Milne Group said the new powers to be delivered to the Scottish Parliament following the Smith Commission report should not be used to penalise high earners.
"Not only is that going to do damage, but it also sends out a signal to people with aspiration that as soon as you move up the ladder you become a bigger target," he said.
Referring to the new Land and Buildings Transaction Tax, the Scottish Government's replacement for stamp duty, which taxes high-end properties at a higher rate than equivalent houses in the rest of the UK, Milne said: "They've introduced new tax powers that are out of step with the rest of the UK, and there could be major consequences flowing from that.
"I think if there is a serious difference [in the income tax rate and bands], people are becoming a lot more mobile and I think there is a big group of people in Scotland who, if they felt the country was getting too far out of step with the rest of the UK, would start seriously looking at their options for the medium to long term, and that could be very detrimental to our economy."
Milne, a former board member of the public-private Aberdeen City and Shire Economic Forum, and a strong supporter of oil magnate Sir Ian Wood's controversial £100 million city-centre development plans which were finally rejected by the city council in 2012, also made a plea for more progress on co-operation between the public and private sectors in improving services and the business environment.
"The most important single thing is the ongoing commitment. It's probably wrong to say there's been no progress in some parts of the country but over the next two to three years we need to make sure the business sector and public sector are working better together".
Milne also said the recovering economy meant that the Stewart Milne Group "could be selling twice as many houses as we currently are", adding: "A lot of new developments are locked up in the planning process, and as they start to come through, over the coming months, then we can see a clear ramp up in our operations here in Grampian."
The group has about 12,500 house plots awaiting development, which he said are "in various stages of the planning system". Around 45% are in the northeast, 35% in central Scotland, and 20% in the Manchester region.
Milne said: "The planning system in Scotland has made a lot of progress in the last eight to 10 years, there's a far greater emphasis on long-term planning. This region is ahead of any others in Scotland, Both the local authorities have implemented fairly ambitious local plans and they are well through the first version of the long-term local plans and are setting out to deliver in the region of 70,000 new homes over the next 15-20 years.
"Local authorities are struggling with resources to deal with the volume of applications; they were forced into severe cutbacks over the past five years. Their ability to meet the demand has been tested."
Aberdeen City councillors recently backed Westhill-based Stewart Milne Group's controversial plans for a £700m, 3000-home development at Countesswells, to the west of the city. The firm also plans to develop the site of the Marcliffe Hotel at Pitfodels after it closes next year under £80m plans for 190 mainly luxury flats.
The group made a £3m pre-tax profit in the year to June 2014, after losing £5.7m in the previous year.
Its return to profitability was accompanied by an increase in Milne's pay package to £1.1m from £800,000 the previous year. Milne wants to see the company double turnover over three years to around £400m via expansion in central and eastern Scotland.
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