Slight cut to income tax and pay rise for public sector workers in Scottish Budget

Scotland's Finance Secretary has said her Budget plans will ensure the economy recovers from Covid-19.

Outlining her draft spending plans in the Scottish Parliament on Thursday, Kate Forbes said the pandemic had "shaken our society and economy to their core."

Describing Brexit as a "wrecking ball'', she added: "Today's Budget will help to bring much-needed support and stability, to ensure our economy recovers and we protect those who have been hit the hardest.

"Our approach continues to target support in the immediate term, as well as tracking a course over the coming year to build a fairer, stronger and greener country.''

She announced £1.1 billion of support for jobs and skills and £16 billion for health, as well as a further £869 million for tackling coronavirus - including funding for the vaccination and test and trace programmes.

Ms Forbes said the strategic framework business fund, which provides grants based on restrictions put on businesses, will continue beyond this financial year, provided funding is forthcoming from the UK Government.

Grants being paid to businesses in February will also be paid at the maximum level, regardless of the level of restrictions on firms, she said.

Councils will also see an increase in their finances, with discretionary funding doubling to #60 million and a further £200 million to compensate for a loss of income due to the pandemic.

All Scottish taxpayers will pay slightly less this year than last, Ms Forbes added, as the tax band system will remain unchanged.

The starter, basic and higher bands of tax will all rise by inflation, with the top rate frozen at £150,000.

Non-domestic rates relief for some businesses will be extended for three months, until more clarity is offered from the UK Government.

Ms Forbes said businesses in the retail, hospitality and leisure sectors will continue to pay nothing while other firms will see their rates fall.

She sought to commit to relief for longer but said the delay to the UK Government's Budget meant she did not have sufficient clarity to allow her to do so.

"The absence of clarity on UK Government non-domestic rates policy has undermined our ability to continue this relief,'' she said.

"I've been clear that the only way I can replicate that relief in full is if there is additional funding from the UK Government.''

She also said a national infrastructure plan for Scotland which aims to support 45,000 jobs across the country will be announced next week, investing £1.5 billion by 2025-26.

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