With powers to change tax comes the responsibility to pay costs, MSPs told

Published on 22/11/2012 01:28

The Scottish Government will have to pick up the cost of implementing any changes in income tax north of the Border, a senior official has told MSPs.

Ministers at Holyrood will get new responsibility for setting the tax under the terms of the Scotland Act. But MSPs were told yesterday that varying income tax north of the border either up or down would increase administration costs.

Edward Troup, the man with responsibility for the collection of the Scottish rate of income tax at HM Revenue and Customs (HMRC), said they would look to the Scottish Government to pay for those.

Mr Troup, who was appearing before MSPs for the first time, explained that part of HMRC’s budget was set aside for the cost of implementing any tax changes announced by the UK Chancellor.

However, he told MSPs: “We will carry no reserve for changes to the Scottish rate.

“We would come back explicitly and say, ‘You have made a change which will cost us X million pounds, that is to be reimbursed’.”

As part of changes being made to devolution, ministers will get new responsibility for the tax rate north of the Border.

Income tax in Scotland will be reduced by 10 per cent, with the Scottish Parliament then 
responsible for bringing it back up or making variations.