Commons Sense

House of Commons · Ministers' Questions

Economic Growth in Scotland: Tax Policies

Tuesday 6 February 2024 · 5 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 0 Partly answered 3 Not answered 0

Key points

  • EY Independent Treasury Economic Model Club forecast predicts Scotland's growth at 0.7% for the year, slightly outperformed by the UK's 0.8%.
  • Business rates relief in Wales is dropping from 75% to 40%, leading to concerns for businesses such as the Kinmel Arms in Moelfre.
  • The Minister claims separation from the UK would impoverish Scots, citing lower GDP per head in Scotland compared to England after 16 years of SNP rule.

Topics (select to filter)

Questions & Answers

Q1 Michael Shanks Lab Rutherglen
Economy Taxation
Context

The EY Independent Treasury Economic Model Club forecast published yesterday found Scotland's economic growth forecast at 0.7% this year, outperformed only slightly by the UK's forecast of 0.8%. This follows 25 tax hikes during the current Parliament and proposed additional taxes by the Scottish National Party.

Question

The EY Independent Treasury Economic Model Club forecast published yesterday found that Scotland's growth forecast for this year is 0.7%, outperformed only slightly by the UK's 0.8%. Given there have been 25 tax hikes during this Parliament and the Scottish National party now proposes even higher taxes on modest incomes in Scotland, does the Minister agree people in Scotland are paying the price for two governments with no economic credibility?

Answer from Nigel Huddleston

No, I do not agree. The OECD suggests we will be growing faster than France, Italy and Germany in coming years. Our Government has a strong track record against our OECD friends over 14 years, and Scotland benefits from this economic growth.

Partly answered

Not addressed: The Minister did not address the specific question about economic credibility of tax policies leading to poor growth in Scotland

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Q2 Michael Shanks Lab Rutherglen
Scotland Wales Local Government
Context

Business rates relief is set to drop from 75% in Wales to 40%, making businesses there pay almost double what English businesses do. The Welsh Labour Government has also proposed increasing the number of Senedd Members by 60%. This context involves concerns about local business support.

Question

In Wales, as in Scotland, business rates are devolved. With relief dropping from 75% to 40%, will my hon. Friend agree that Welsh Labour's failure to extend protections seen in England means businesses like the Kinmel Arms in Moelfre face tough times?

Answer from Nigel Huddleston

My hon. Friend puts it well. We have seen considerable protections and support for retail, hospitality and leisure business rates relief in England but not extended in the same way in Wales or Scotland.

Partly answered

Not addressed: The answer does not address whether the Welsh Government's actions are detrimental to businesses

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Q3 Virginia Crosbie
Economy Scotland Brexit
Context

OECD forecasts suggest the UK will have the lowest growth in G20 nations, with highest inflation rates in G7. The Minister previously stated there is no real cost of living crisis, but independent data suggests otherwise.

Question

Contrary to what the Minister said earlier, OECD forecasts show that UK has lowest growth in G20 and highest inflation in G7. Ministers like to pretend there's no cost of living crisis; however, it's biting hard. How long will they continue peddling fantasy about Brexit being good for Scottish people?

Answer from Nigel Huddleston

I am afraid that separation from UK would most impoverish Scots. After 16 years of SNP rule, GDP per head in Scotland is lower than England's; productivity falls, employment low and inactivity high. This is not a proud record.

Not addressed: The Minister did not address the question about denying negative impacts of Brexit on Scotland's economy

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Q4 Drew Hendry SNP
Economy Scotland Brexit
Context

Office for Budget Responsibility forecasts predict a long-term 4% lower UK GDP due to Brexit. Meanwhile, independent Ireland in the EU is flourishing with substantial fiscal surplus.

Question

The Minister talks about GDP. OBR forecast that UK's GDP will be 4% lower in long term due to Brexit. Independent Ireland booming in EU, huge fiscal surplus. Given Tories, Labour and Lib Dems now championing Brexit, isn't it true Scotland rejoining EU only possible through independence?

Answer from Nigel Huddleston

The IMF has forecast us greater growth than France, Italy and Germany. If he supports growth, perhaps SNP Members could join Lobby last night instead of voting against full expensing and R&D investment.

Not addressed: Minister did not address the question about Scotland's potential path to rejoin EU via independence

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Q5 Drew Hendry SNP
Economy Taxation Scotland
Context

Question about assessing impact of Department's tax policies on Scotland's economic growth during this Parliament, with concern over multiple tax hikes and proposed additional taxes by Scottish National Party.

Question

If he will make an assessment of the impact of his Department's tax policies on economic growth in Scotland during this Parliament. Given 25 tax hikes this session and proposed further increases by SNP on modest incomes in Scotland, does Minister agree people there face repercussions from poor policy choices?

Answer from Nigel Huddleston

The Government remain committed to increasing economic growth in Scotland. Tax policies introduced include full expensing permanence and largest ever cut to employee/self-employed national insurance contributions, aimed at stimulating economic growth.

Partly answered

Not addressed: Minister did not provide specific assessment of impact on Scotland's economy due to current tax policies

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