DOUGLAS Ross has defended his plan for around half a billion pounds of income tax cuts over the next parliament, after he was accused of engineering a 'Ross Rebate' for himself and other better-off Scots.
The Scottish Tory party leader said he wanted “parity” for the 1.1m income taxpayers in Scotland who currently pay more than people in the same jobs in the rest of the UK “when public finances allow”.
The Liberal Democrats said he was promoting a “Ross Rebate” for himself, while the SNP said the Tories wanted to take Scotland back in time with “Dickensian policies” .
Mr Ross said he would personally forego any cut to his own tax bill, but that did not lessen the political row.
The Scottish Tory manifesto said it would keep the current starter rate of income tax for low earners, but reduce income tax levels for almost half of Scots earners at the upper end of the wage scale.
The Scottish Government said it raised an extra £456m last year under Scotland's more progressive income tax system than if it had shadowed the rest of the UK.
But a costings supplement the Tories issued with their manifesto failed to put a price on the tax parity policy.
It merely said: “In the event that tax revenue outstrips public spending demands, then we would seek to realign income tax rates and bands with the rest of the UK, while retaining the starter rate.”
The manifesto also proposed a tax cut for housebuyers by raising the sales tax threshold from £145,000 to £250,000, which would cost £200m over the end of the parliament.
Workers in Scotland who earn less than £27,393 pay less income tax than in the rest of the UK, while those on more also pay more income tax under Scotland’s five-band system.
Different rates, bands and thresholds mean someone earning £50,000 a year in Scotland would be £1500 worse off than their equivalent south of the border.
Scottish low earners are at most £21 a year better off because of the income tax differences.
Speaking to the media after his manifesto launch in Glasgow this morning, Mr Ross was asked why there were no tax cuts for the low paid, only the better off.
He said: “This is focusing on 1.1m Scots who are taxed more for doing the exact samejob in other parts of the United Kingdom. It’s our teachers and police officers.
“We said we would keep the starter rate, to protect those on low incomes.
“But over the course of the parliament, if we can get our economy back up and running again, we would seek to return parity in the system, because the SNP have made Scotland the highest taxed part of the United Kingdom, and that affects 1.1m people.
“People understand that’s not something we can do immediately given the economic issues we are facing as a country, it will take time to recover our economy and rebuild after Covid.
“But in we get to a stage where [tax revenue] is higher than our spending, then we would seek to restore the parity and our taxation system here in Scotland to help 1.1m Scots who are paying higher tax here in Scotland compared to other parts of the country.”
The Scottish Liberal Democrats, who don’t propose any substantial changes to Scottish income tax, said the Tory plans would see Mr Ross and all MSPs a £1,321 tax cut.
MP Alistair Carmichael said: “It is the wrong priority for Scottish Conservative MSPs to give a tax cut to each other. Each Conservative MSP will save £1,321 under their own proposals.
“Douglas Ross is promoting a Ross Rebate for himself at a time when we know the health service is struggling to cope with the crisis.
“The Conservatives have offered NHS workers a paltry 1% pay rise. But Douglas Ross will get an increase of double that just by his own tax proposal. This doesn’t even include the additional salary he will get for being both an MSP, an MP and a referee.
“Tax cuts for high earners should not be the priority as we put recovery first.”
SNP Depute Leader Keith Brown, whose party has propsoed a five year income tax freeze, which would also benefit the better off, said: "Behind their rhetoric, these are the same-old Tories – completely out-of-touch, planning tax cuts for the rich and austerity for everyone else, and only interested in widening the gap between rich and poor in our society.
“It is shameful that rather than taking on the millionaires that fund their party, the Tories are instead ruthlessly focused on attacking those on lower incomes - giving their millionaire chums a tax cut, which Douglas Ross himself would benefit from, while those on low wages get nothing.
“The Tories seem determined to take Scotland back in time with their Dickensian policies, offering more money to the wealthiest in society while cutting the NHS budget at the same time. They simply cannot be trusted to deliver a fair recovery, economy or society.”
Scottish Labour leader Anas Sarwar added: “Coming through this pandemic, we have huge opportunities about what we can do around the national recovery.
“There are billions of pounds... we should be spending on the here and now of the national recovery. We should be using that money, not to give tax breaks, but instead to focus on that national recovery so we can give people support.”
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