WHO would want to be John Swinney this morning?

There has been strong speculation all week that he will stand up in parliament today and announce tax rises, right in the middle of a cost-of-living crisis. It should come with a health warning: this will hurt. But if Scotland is to maintain its proud status as the most progressive part of the UK, then there’s not much sign of a better alternative.

No one is unaffected by the rising cost of everything. Even some people who appear fairly affluent on paper are rationing their energy use and stressing about food bills. Two hundred thousand people in Scotland with fixed-rate mortgages are facing a hike of £3000 in their annual costs, due to higher interest rates. The Scottish Government snaffling more of their earnings will definitely hurt.

Even so, some form of higher taxation is likely. Lowering the threshold for the top rate of tax from £150,000 to £125,000, as Jeremy Hunt has done for the rest of the UK, would only raise £40m in Scotland at the very most, says the Fraser of Allander Institute, so we can expect something more.

Mr Swinney may announce one or more of the following: tax rises by stealth through freezing or reducing the higher and top income tax thresholds, to draw more people into paying those rates; introducing another tax band between the higher and top rates; and going the whole hog by slapping an extra penny or two on the higher rate and above.

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He's unlikely to relish any of it, but we’ve left the land of popular choices behind and are now deep in tough decisions territory. A recession is upon us that will last one year or even two, hardship is increasing, public sector pay increases are putting pressure on inflexible budgets and the Scottish Government cannot borrow like the UK government can. The Scottish Government has already had to cut spending this financial year. The choice from here is tartan austerity or tax rises.

For the next two financial years, consequentials from the Chancellor’s autumn statement will offset the impact of inflation on the Scottish budget, according to Fraser of Allander, so raising taxes would be a means of trying to accommodate higher public sector pay while helping hard-pressed services and increasing support for the worst-off.

So will Mr Swinney’s budget pass the fairness test? Well public sector wage growth, UK-wide, has been lagging behind the private sector, and recruitment and retention issues are already so severe in some professions that allowing real-terms public sector pay to slide significantly could be disastrous. Decent pay awards that take account of inflation mean more stable public services.

When considering tax rises to help pay for it, though, ministers will know that private and voluntary sector pay is also falling in real terms and in a recession, the situation could worsen. Outside the public sector, workers also tend to have lower job security and worse pensions. So a balance must be struck that’s seen to be fair.

We’ll see, but what’s clear is that widely supported, progressive Scottish policies will falter and fail unless there’s more cash, and those on the lowest incomes will suffer the most.

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The deputy first minister has said his priorities are tackling child poverty, delivering net zero and developing sustainable public services. Well, good. Those don’t seem to be such high priorities at Westminster. One huge spending commitment the Scottish Government has taken on is new social security benefits, the most significant being the Scottish Child Payment for low income families, worth £25 a week per child under 16. It’s a direct, tangible attempt to tackle child poverty and is forecast to cost £500m a year.

The Scottish Child Payment reflects a sincere commitment to tackle deprivation but also has a political dimension in projecting the SNP’s central idea that this government, and by extension independence, is really about social justice.

But this is not a government that has shown a strong appetite for raising taxes to pay for such policies, having done so minimally in the past. It’s been accused of sounding lefty but cleaving repeatedly to the centre ground.

So this current crisis has created a real test of its true nature. Tax rises now will show that the SNP is prepared to make some of the tough choices that would be necessary in an independent Scotland to keep alive the vision of a progressive Scotland in financially challenging times. How far will Mr Swinney go?

The need is so very great. Food banks face unprecedented demand. Education budgets are being cut. The health service is in A&E. Forty three per cent of people can’t heat their home to a comfortable level, according to Consumer Scotland. An anaemic budget announcement that tried to avoid spooking the horses in suburbia while allowing poverty to deepen, would be a credibility-buster. It would also just be wrong.

Tax rises on the wealthiest do of course risk unintended consequences. This is a real dilemma for the Scottish Government: it wants to capture more wealth from top earners but as the Office of Budget responsibility warned this week, could end up losing all of it if those wealthy few choose to domicile themselves south of the border.

That’s why asking a bit more of higher earners, not just the very wealthiest, is now a real possibility.

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There are also other taxes to consider. Everyone agrees council tax is regressive, but the SNP haven’t reformed it due to nervousness about increasing taxes on middle Scotland. There are now renewed calls for it to be replaced with a land tax, based on land value, or a proportional property tax, where people pay a proportion of their home value each year. More immediately, the IPPR think tank reckons raising council tax on property bands F, G and H by £100 a year would net £69m. Wealth taxes, a frequent flier levy, tourist and carbon taxes are also back under discussion – anything, in fact, that could bring in a bit more cash.

One day when prosperity returns and the benefits bill falls, tax levels can be revised down again, not least because ministers need options for when the next crisis hits.

But right now, the state of public finances calls for radical action.