The First Minister pledged to freeze income tax levels in Scotland if she wins the Holyrood election in May. But it means Scots will miss out on the tax cut unveiled by George Osborne in last week’s budget.
Personal allowances will also be raised by the SNP to £12,750 by 2021-22 – £250 higher than the expected UK level – to ease the burden on low earners.
The measures will raise an estimated £1.2 billion more for public services north of the Border. Ms Sturgeon unveiled the plans at the Royal Children’s hospital in Glasgow yesterday and believes Scots will accept higher taxes to fund better public services such as free university tuition. “We will not allow our public
services to pay the price of an inflation-busting tax increase for the highest earning 10 per cent of the population,” she said. “We think that is the wrong choice.
“By adopting a different path to the UK Government we could generate more than £1 billion of additional revenues, enabling us to protect the public services we all rely on.
“We believe that this proposal is reasonable, it is balanced and it is fair.”
The basic, higher and additional rates for top earners will be frozen under plans set out by Ms Sturgeon. Although she supports a UK-wide rise in the additional rate for those making £150,000 or more, from 45p at the moment to 50p, the prospect of Scotland implementing this alone raises the risk of many in this group moving south and revenues being lost.
Labour leader Kezia Dugdale said the SNP has failed to use Holyrood’s tax powers to tackle austerity.
She said: “The SNP commissioned a report into replacing council tax and then bottled it when it was time to be radical.”