SCOTTISH Labour leadership front-runner Jim Murphy has pledged to introduce a 50p top rate of tax for those earning more than £150,000 – revealing he would use new powers on taxation to make the wealthiest few “pay a little more”.
He has backed the devolution of full income tax powers to Holyrood ahead of the publication tomorrow of the findings of the commission chaired by Lord Smith of Kelvin, which has been tasked with delivering a new devolution settlement.
However, Mr Murphy, speaking at a campaign event in Glasgow yesterday, said he would use the full income tax powers he wants devolved to Holyrood to increase taxation for Scotland’s wealthiest earners to help fund universal services and benefits.
He confirmed he would maintain free universal services, such as free NHS prescriptions and free personal care, for all Scots, including for top-earners, if was he was First Minister.
However, Mr Murphy said the wealthiest Scots would be expected to pay higher taxes to fund the free services, as well as pay for additional support for small businesses and cover the cost of “an assault on poverty”.
Mr Murphy, a former secretary of state for Scotland, said the introduction of a 50p rate of tax for those earning more than £150,000 a year would affect some 16,000 people and raise up to £250 million.
The UK Labour leadership has suggested it would also restore the top rate of tax to 50p, after it was reduced to 45p by Chancellor George Osborne.
However, Mr Murphy suggested the devolution of full income tax powers to Holyrood would allow Scotland to have a “more progressive tax system than the rest of the UK”.
He said: “I have made my policy clear. It’s time for the leaders of the other parties to do the same.
“We believe those who can afford it should pay a little more, while those who have least should not see the little they have, in money and services, taken away from them.”
Mr Murphy went on to state he had spoken to UK Labour leader Ed Miliband and shadow chancellor Ed Balls about the policy he would pursue if he was elected party leader in Scotland.
However, he said he would not “seek approval” from Labour’s Westminster leadership to raise the top rate of tax in Scotland from 45p to 50p if he defeats shadow health minister Neil Findlay and Lothian MSP Sarah Boyack in the contest to succeed Johann Lamont.
Mr Murphy said: “Decisions on what the Scottish Labour Party does are for the Scottish Labour Party. I’m not going to seek permission or seek approval from anywhere else in the UK.
“My approach is that Ed Miliband and Ed Balls can read about it in the newspaper like everyone else.”
He said he would be appointing an expert panel to implement the findings of the Smith Commission, which are expected to include a recommendation of the full devolution of income tax as well as some responsibilities for welfare.
The East Renfrewshire MP, speaking after yesterday’s campaign event, said he would reveal the names of those who will be invited to serve on the panel after Lord Smith makes his recommendations on the transfer of powers pledged by the main unionist parties in “the Vow” to Scots towards the end of the referendum campaign.
Mr Murphy’s leadership candidate rivals have both expressed reservations about the devolution of all income tax powers from Westminster to Holyrood.
Mr Findlay said: “I believe in the principle of progressive taxation where the people with broadest shoulder bear a heavier burden to help the poorest. It will be that principal that will guide my thinking on taxation.”
Ms Boyack said: “I’m not going to pre-empt the Smith Commission. If Scotland is to get the full devolution of income tax, and that has not been confirmed, I’d want a cast-iron guarantee from Lord Smith that Scotland will be no worse off.”
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