Restoring tax credits to families in Scotland would have a greater economic impact than cutting air passenger duty (APD), Labour has claimed.
The party said the SNP had the “wrong priorities” with its plan to cut APD by 50% before abolishing it altogether at a cost of £250 million a year.
It cited research by the independent Scottish Parliament Information Centre indicating that £250 million of additional activity in the aviation industry could generate 2,300 jobs.
The jobs impact if the equivalent amount of money was directed to households to spend on Scottish goods and services would be 3,500, according to the research.
Labour has set out plans to mitigate the UK Government’s tax credit cuts in Scotland, to be partially funded by not going ahead with the APD cut.
First Minister Nicola Sturgeon has also pledged to counter the changes if they are pushed through by Chancellor George Osborne, but has not given details of what form this would take or how it would be paid for.
Labour’s wealth creation spokeswoman Jackie Baillie MSP said: “This new expert analysis makes clear that Scottish Labour’s plan to put money in the pockets of working families is a much better way to create jobs than the SNP’s £250 million plan to make airline tickets a bit cheaper.
“The SNP have been all over the place in the last few days on tax credits. First they told us the Scottish Parliament wouldn’t have the power to act and in any event it would be too expensive to help working families.
“Then they admitted that wasn’t true but wouldn’t tell us whether working families would be entitled to the same support as they are now. It’s an utter shambles.”
New changes to the Scotland Bill will give Holyrood the power to top up tax credits but the SNP is pressing for the cuts to be scrapped entirely and for all tax credit policy to be devolved.
The Bill will enter its final parliamentary stage with a House of Commons debate and vote tomorrow.
Labour shadow Scottish secretary Ian Murray MP said: “Scottish Labour have been very clear that we would use the new powers to restore the money lost through tax credits if George Osborne goes ahead with his plan.
“The SNP will spend all their time in the Commons calling for power over tax credits, when the power to restore the money lost is already heading our way.”
SNP depute leader Stewart Hosie MP welcomed the changes to the legislation announced by the UK Government last week, but said it still had shortcomings.
He said: “The SNP amendments to the bill are aimed at avoiding the worst excesses of the Tory cuts and austerity – by giving Holyrood greater welfare and employment rights and job creation powers.
“The SNP amendment on tax credits would devolve control over all aspects of working and child tax credits to Scotland.
“The Scotland Bill as it stands will give Scotland the power to top up benefits – but gives Scotland no power to do something for those who will lose their credits entirely as a result of the Tories’ tax credit cuts.
“Labour must be clear on whether they will back our amendment so we can protect low income families in Scotland, or if they will again side with the Tories in denying vital powers for Scotland.”
A Scottish Government spokesman said: “Improving Scotland’s air links and connectivity is key to jobs, investment and the economy and ministers committed in the Programme for Government to reducing the burden of APD by 50% with the reduction beginning when we introduce a Scottish APD in 2018.
“Reducing APD will help to attract more direct routes to Scotland, which will in turn reduce the need for more connecting flights to hub airports.
“The stakeholder forum and consultation will enable us to work with a range of partners – including the aviation industry and environmental groups – to begin the process of designing and developing a Scottish APD to help deliver our objective of sustainable economic growth.”
SNP MSP Stewart Maxwell said: “These are ridiculous claims from Jackie Baillie whose leader has already spent the APD money on education.
“The SNP is doing all we can to stop George Osborne’s tax credit cuts whilst Labour are letting the Tories off the hook. The only people Jackie Baillie is helping are George Osborne and his tax credit-cutting Tories.”