Nicola Sturgeon has hit back at "ridiculous" claims that Scotland is the highest taxed part of the UK.
The First Minister insisted taxpayers north of the border "get a far better deal" than their counterparts in England, Wales and Northern Ireland as a result of Scottish Government policies such as free university tuition and free personal care for the elderly.
Conservative leader Ruth Davidson had pressed Ms Sturgeon on the impact of "setting higher taxes" in Scotland and "putting higher burdens on employers".
The Scottish Government has no plans to increase the threshold at which people start to pay income tax at 40p, as the UK Conservative Government is doing, with SNP ministers dismissing the idea as a Tory tax cut for higher earners.
Ms Davidson also told MSPs that businesses in Scotland are suffering as a result of the business rates revaluation, citing the example of one company which has seen its bill rise by 63% - saying bosses at the firm had described the increase as "nothing short of daylight robbery".
She challenged Ms Sturgeon on the issue at First Minister's Questions, saying: "The facts are these. Unemployment in Scotland is up, employment is down. While confidence for small firms in other parts of the UK is going up, here it is falling through the floor.
"Yet we have a Finance Secretary who is hidden from companies that say that rates are pushing them to the wall. We have got a Government that taxes people and firms here more than anywhere else in the UK, and again this week they are threatening further instability with their own referendum, this time another one on independence.
"This Government is about to present the most important budget since devolution, deciding on the taxes that Scots pay.
"And the question is this, does the First Minister stick to her current plan of making Scotland the most highly taxed part of the UK, driving out businesses and jobs, or will she change course?"
Ms Sturgeon responded: "Let's look at this ridiculous claim about Scotland being the highest taxed part of the UK.
"If you're a taxpayer in Scotland, you don't pay tuition fees for your younger children to go to university, if your elderly parent is in care you don't pay personal care, you've got a healthcare system free at the point of use.
"Taxpayers in Scotland get a far better deal than taxpayers in the rest of the UK."
On the issue of business rates, she said increases are "tied to increases in the rateable value of premises".
But she said the Scottish Government's discount scheme for small businesses "goes way beyond anything in any other part of the UK" and is "lifting 100,000 small businesses out of business rates altogether".
She added: "This Government has ensured we have a competitive, probably the most competitive, business rates regime anywhere in the UK because that is the importance we attach to small businesses."
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