Tax-varying powers are at the heart of the Calman Commission�s report, with forecasts of its conclusions suggesting its recommendations go further than many expect and others might want.

Tax-varying powers are at the heart of the Calman Commission's report, with forecasts of its conclusions suggesting its recommendations go further than many expect and others might want.

Holyrood at present has the power to alter the basic rate of income tax by up to 3p upwards or downwards, the so-called Tartan Tax, but this power has never been used.

Currently, income tax-payers in Scotland put around £10.5bn a year into the public sector revenue pot, and around 90% of that is raised from the basic rate, but the new formula changes how it would be collected.

Sources say that under the proposals in the commission's final report, UK income tax rates in Scotland would be set 10p lower than at present, making them 10p for the standard rate and 30p for the higher rate, and the money raised would go to Westminster.

A Scottish Government would then levy a "Scottish variable rate", the proceeds of which would go to Scotland.

This would be an additional 10p if present overall rates were to remain unchanged, but there would be no upper limit beyond what was politically possible.

The catch is that the same variable rate would apply across all tax bands so 11p on the basic rate, taking the present total to 21p, would mean 11p on the higher rate, taking it to 41p.

The effect is intended to make it difficult for Holyrood to impose a disproportionate burden by hitting higher-rate tax-payers alone.

Just as controversial could be allowing changes to stamp duty on house sales. If this went ahead, it is likely that the higher end of the market would be hit, adding thousands of pounds to the purchase price.

Stamp duty on properties valued at more than £500,000 is set at 4%. A rise of even 1% on a half-million-pound home would cost the purchaser an additional £5000.

However, ministers might also want a reduction in stamp duty on cheaper properties, a move which would help first-time buyers.

Also discussed but less sure to be approved was the possibility of "natural resources taxation" which would boost Scotland's finances by assigning some North Sea oil revenues to Holyrood, allowing the creation of a Scottish oil fund.

Other tax measures proposed by Calman include devolving air passenger duty, a landfill tax and a tax on mineral extraction.

These combined measures would leave Scotland responsible for raising about a third of its £32bn annual spending.

It would also lead to a corresponding reduction in the size of Scotland's block grant from Westminster.

What Westminster gives with one hand may well be taken away by the other.

The commission is also likely to recommend giving Holyrood borrowing powers for large infrastructure projects such as the new Forth crossing.

Calman is also expected to back devolving laws on speeding and drink-driving to Holyrood as well as legislation on airguns.

Justice Secretary Kenny MacAskill will be happy to throw his weight behind those plans even though his government colleagues kept their distance from the commission because independence was not within its remit.

Labour, the Conservatives and the LibDems all embraced the commission and, while it was a Labour Government which set it up, the winners of the next General Election will decide on which recommendations it will back.

That is why Scottish Tory leader Annabel Goldie is off to Westminster tomorrow for talks with David Cameron.