Leader comment: Any income tax rise must aid front line services

Finance Secretary Derek Mackay. Picture: Lisa Ferguson
Finance Secretary Derek Mackay. Picture: Lisa Ferguson
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The contents of this week’s Scottish budget are eagerly awaited, or at least, as eagerly as it is possible to muster enthusiasm for an announcement on government spending commitments.

The key issue for most observers will be income tax, and whether or not the Scottish Government will vary taxation rates and create a system where someone living north of the border will pay more than if they chose to stay south of the border.

Taxation is sure to make the headlines when Finance Secretary Derek Mackay reveals all on Thursday, but even if change is coming, it will only affect a section of society. The issue that will be felt by all of us is the level of funding that is to be made available to local authorities.

In our Insight feature this week, we examine how years of austerity have impacted on the provision of local services in our biggest council areas, and the overall picture is one of unremitting cutbacks, job losses and threats to future provision of services we might consider to be core.

It could be argued that we should expect no different, because the warnings have often been sounded – UK-wide – that austerity has some way to go before we are through it.

But within the restrictions of the wider economic picture, there is still room for manoeuvre. Mackay and his cabinet colleagues know that an income tax rise could ask for trouble, even if there is support at Holyrood from some opposition parties for the measure. The electorate is likely to be influenced more by an increased tax take than loyalty to a particular political party.

If the Scottish Government is to take that risk with taxation, it would do well to come up with an acceptable reason for doing so, and it would make sense to tie such a rise to an increase in local authority funding.

The Scottish Government has played hard-ball with councils in recent years to force the issue of responsible spending. It should consider that intention to have been achieved. Now, as front line services are clearly failing to make ends meet, it is time for respite.