Nicola Sturgeon is leading Scotland’s economy to disaster by imposing higher taxes than in England, says the Scottish Secretary.
The SNP has signalled they will not follow the Chancellor’s income tax breaks announced in Monday’s Budget.
It means senior professionals in Scotland such as doctors, teachers and police officers will be even worse off than those on the same salaries down south from April 2019.
David Mundell, who sits in Theresa May’s cabinet, told The Courier that failing to tackle the widening tax gap between England and Scotland would be ruinous for the economy.
“I can’t understand with one breath the SNP say they want to attract people to come to Scotland and then they follow it up by making Scotland the highest taxed part of the UK,” he said.
“In my view that is a disastrous approach for our economy and actually, as they have demonstrated with their high stamp duty tax, it ultimately leads to a reduction in revenue and people voting with their feet.”
The salary threshold at which workers pay the 40% higher rate of tax will increase from £46,350 to £50,000 in the rest of the UK from April, a year earlier than expected.
Mr Hammond also fast-tracked to £12,500 the personal allowance, the level at which earners start paying tax.
The Fraser of Allander Institute calculated that a Scot earning £50,000 will be £1,100 worse off than an English counterpart each year when the new thresholds kick in.
In Scotland, the higher personal tax rate, which is 41p, takes effect at £43,431.
Today most Scots pay less income tax than if they lived in rest of Britain.
But the overall contribution by taxpayers is higher north of the border than it would be under the UK Government policy.
Derek Mackay will set out his tax plans in his Budget in December.
A spokeswoman for the First Minister suggested the tax cuts will not copied north of the border.
“We set the tax rates in Scotland,” the spokeswoman said.
“We have chosen to take a different path, which is progressive, which means the vast majority of people pay less tax.”
She added: “Passing on Tory tax cuts for the better off is not our priority.”
Mr Mackay told Holyrood on Tuesday: “I take some pride in the fact that I have been the finance secretary that has ensured that we have got the fairest income tax system anywhere in the UK.
“And for a majority of people they pay less tax and this is the lowest taxed part of the UK.
“The Tories have once again chosen tax cuts for the richest in society and we will choose a fairer, a more progressive path.”
