Holyrood tax

Scottish secretary David Mundell celebrates the bringing forward of the Smith proposals by one year from 2018 to 2017 as an achievement, whereas it is simply opportunism (“Holyrood to have power to reverse Tory benefit cuts”, 6 October).

He persists in targeting the SNP to declare the use they would make of the powers, thus implying their victory in the 2016 Holyrood elections, while the other parties get off.

Your headline is disingenuous because the benefits cuts could come from any party in power at Westminster. However, on welfare, it seems it is only partial powers that would come to Holyrood – the whole welfare programme would remain with Westminster, with Holyrood simply supplementing them here.

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As the article states, were a Scottish Government to opt to do that, it would have to raise taxation, or make savings elsewhere – the latter would not be feasible as Holyrood already has to cope with the Barnett squeeze which imposes a 1 per cent shortfall on our funding, and there is no certainty that, initially, estimates of tax proceeds would not produce a further shortfall, thus compromising the budget.

And there is a problem regarding income tax proceeds under the new powers. Paragraph 78 of the Smith report indicates that these would be offset by a reduction in our block grant, so they would be of no value to us. This seems to be corroborated by the answer Treasury minister David Gauke gave at Scottish Questions on 17 July: as income tax assumed greater prominence, the Barnett formula would have less significance.

There is much mention about the “fiscal framework” but little clarity. My interpretation is that they refer to the operation of Barnett. This is significant because Barnett does not feature in the legislation, ie, the imminent Scotland Act, 2015 (or could it be 2016?). We need to know.

We should not overlook the attitude of the English in all this. They consider that their taxpayers subsidise Scotland, and they will be incandescent if we are to get extra powers to pocket the proceeds, while being unable to fund services fully at present.

That virtually guarantees we will not benefit from any increase in a Scottish income tax – which would suit us quite well, because the last thing we need is a tax increase!

Isn’t it about time they came clean and made that clear? In normal circumstances the battle between the two main parties would have exposed the aberrations, but they dare not upset their new-found camaraderie!

By the way, the Calman tax proposals in the Scotland Act 2012 will be implemented from 2016.

Douglas R Mayer

Thomson Crescent, Currie