Greens put SNP budget at risk by holding out for 60 per cent tax on the rich

The SNP government is running out of options to find support to get its budget passed after the pro-independence Greens warned they won't back the current proposals.

Greens co-convener Patrick Harvie wants a 60 pence rate for top earners but says he is ready to compromise. Photograph: John Devlin

Greens co-convener Patrick Harvie insisted there is a “clear need” for new income tax powers to be used. The party backs a 60 pence rate for top earners but is ready to “compromise”.

If the government fails to secure a majority for its budget, the first to include new income tax powers, it could result in an election being called.

The opposition will step up pressure on finance secretary Derek Mackay this week in a Holyrood debate amid anger over the looming £327 million cut to direct council funding. And while the Greens, Labour and Liberal Democrats want to see tax increases to fight austerity, the Tories are demanding that tax rates remain at UK level. The minority SNP government will need other parties to back the plans or abstain.

The SNP plans would make Scotland the highest taxed part of the UK, by not passing on UK plans to extend the 40p tax threshold to £45,000 from about £43,000 currently.

The Greens included plans to hike income tax to 60p for the very highest earners in their manifesto for the 2016 Holyrood elections – which saw the party increase its number of MSPs from two to six.

“Compromise is going to be needed,” said Harvie. “However, it takes two to reach a compromise and the SNP’s draft budget showed no signs of any effort to work with others.”

Labour has already said it will vote against the budget because of cuts to local government, with leader Kezia Dugdale declaring the budget “cuts into our country’s future”.