Sturgeon faces demand to raise income tax for Scotland’s richest

First Minister Nicola Sturgeon during a visit to Castlebrae Community High School in Edinburgh where she met teachers and pupils who have been part of a three-year residency programme with the Edinburgh International Festival. PRESS ASSOCIATION Photo. Picture date: Friday August 18, 2017. See PA story SCOTLAND School. Photo credit should read: Jane Barlow/PA Wire

Nicola Sturgeon has faced fresh calls to hike taxes for the rich after new figures showed the number of top earners in Scotland reached a record high.

The First Minister has refused to use Holyrood’s new powers to introduce a 50p additional rate, saying it could have the perverse effect of reducing the country’s tax take.

Kezia Dugdale, the Scottish Labour leader, says that argument has been torn apart by HMRC figures showing there are now 21,000 people in the country paying the top level of income tax by earning £150,000.

That is a 91% increase on the 2010/11 figure, according to the party’s analysis.

Ms Dugdale said: “Labour supports a 50p top rate of tax because we think the richest should pay their fair share.

“It can’t be right that levels of working poverty are at their highest since the Scottish Parliament was established, but the SNP still won’t ask the richest to pay a little more in tax.

“A radical Scottish government focused on making Scotland a better place to live, work, grow up and grow old in should be using the powers of the Scottish Parliament to tax the richest and invest.”

The SNP’s general election manifesto called on the Conservatives to raise the 45p additional rate by 5p in the rest of the UK. The party warns of a loss of revenue if Scotland pursued the policy on its own without Holyrood assuming powers over tax avoidance.

Ash Denham, the SNP MSP, said bringing the 50p rate in now would mean less money for vital public services, but pledged the party would keep it “under review”.

“The SNP’s position is very clear. We back a 50p top rate of tax across the UK, but to do it in Scotland alone with our current powers could risk losing millions of pounds in revenues given the possibility of cross-border tax avoidance.

She added: “With the powers we have we are making taxation fairer – unlike Tory moves in England to hand tax cuts to the wealthiest – and the SNP’s tax policies mean there is more money to pay for schools, hospitals and other public services.”

The HMRC figures showed that 21,000 Scots earned at least £150,000 a year and had to pay 45p in tax for every £1 earned over that sum. That is up on 18,000 who did so the previous year and the 11,000 in 2010/11.

The Scottish Conservatives say forcing Scots to pay more income tax than those in other parts of the UK would be damaging.

Murdo Fraser, the party’s finance spokesman, has said increasing taxes will “punish workers, harm the economy and raise less money”.