Income tax questions answered after Scottish Budget unveiled

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Finance Secretary Derek Mackay has announced income tax changes in his Scottish Budget first draft.

:: Why has Scottish Finance Secretary Derek Mackay taken the historic decision to create new income tax bands and increase rates for those earning over £33,000?

The Scottish Government claims the changes will enable it to raise an extra £164 million which it says will enable it to “fulfil our commitments” to the NHS without cutting public spending in others areas and make Scotland the “fairest taxed part of the UK”.

:: Who will be affected?

The 1.8 million taxpayers earning less than £33,000 in 2018/19 will pay less income tax than if no changes had been made but the remaining 30% of taxpayers face paying more.

:: How is the Scottish Government able to make this decision?

Power over income tax was devolved to the Scottish Parliament last November as part of the Scotland Act 2016. Handing over control on the tax was a key recommendation of the Smith Commission, set up to examine which further powers should move from Westminster to Holyrood following the Scottish independence referendum in 2014.

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