Scottish Budget 2020: What are the key proposals?

Tax

Income tax rates will remain the same - but the threshold where the upper rates kick in will be frozen.

The decision means anyone earning more than £43,430 will fall under the 41 per cent “higher” rate and will result in an extra £149 being paid by 370,000 taxpayers as part of the spending plans for 2020/21.

The thresholds for the lower “basic” and “intermediate” rates will rise in line with inflation, but the “higher” and “top” rates – starting at £43,431 – have been frozen.

It means about 19,000 Scots will be sucked into the higher rate next year who didn’t expect to be, paying up to £149 extra. About 370,000 existing higher and top rate earners will see an increase of £149.

The move will bring in an extra £51 million a year for the Government.

More than half of Scottish income taxpayers (56 per cent) will pay less tax than if they lived anywhere else in the UK.

The Tories had called for no further divergence in personal taxation between Scots and those elsewhere in the UK.

Spending commitments

The budget had a particular focus on environmental issues, with Ms Forbes saying it would "step up the delivery of our ambition to tackle climate change".

This includes £1.8bn of capital investment in projects to reduce emissions, and funding for active travel, electric vehicles, agriculture and peatland restoration.

New finance secretary Kate Forbes set out plans to introduce a new two per cent rate of land and buildings transactions tax on residential properties worth more than £2m.

A package of funding to accelerate Scotland’s transition to a net-zero economy was also unveiled, including £1.8 billion of investment in low carbon infrastructure that will help reduce emissions.

Local authorities

Councils are to get an extra £494m after a warning in the build-up to the Budget that frontline services were close to breaking point.

Gail Macgregor, resources spokeswoman with local government body Cosla, said last month this included Scottish Government commitments of £590m, which means an effective cut to budget of £95m.

The Scottish Child Payment which will be introduced paying £10 per week, per child every four weeks to eligible families with children under six

Businesses

The Scottish National Investment Bank to be operational in 2020, supported by the £150m Building Scotland Fund and a further £220m in direct investment in 2020-21

Research and development spending will continue to increase towards the 2025 target of £1.7bn, doubling spending over a 10-year period.