The Scottish Conservative plans for tax are about as good as you can do under devolution, but that’s not saying much

The Scottish Conservatives have produced a fascinating report on the future of Scottish devolution after a ‘no’ to independence vote. The headline grabber is the recommendation that the UK devolves income tax to the Scottish Parliament, to further a commitment to ‘a greater degree of fiscal autonomy’.  My concern is that its aim will be shortened in most reports to describe ‘fiscal autonomy’ (see Under ‘Devo-Max’, ‘Fiscal Autonomy’ is an illusion). Yet, it is nothing of the sort.

Fiscal autonomy is about the power to make important choices about how to balance taxation: on income, employer contributions, as a contribution to social security, on sales (VAT), on corporations, on energy and pollution, and so on (in some cases, it is about using taxation to encourage or discourage behaviour – as with fags and booze). It is about working out how much to raise and from whom, and to combine that decision with how to provide social security. It is about the power to decide who pays and who benefits. So, if people say that this new power would give the Scottish Parliament something like 40% of its tax raising power (see here on the politics of such calculations), it would be misleading to think that it’s 40% of the power to decide who pays and who benefits.

Rather, it is one, disproportionately limited, tax. Crucially, it is a tax that gains disproportionate public and media attention: ‘Elections can be won or lost on the basis of what political parties say about income tax’ (p13). It has never been raised or lowered in the short history of Scottish devolution, and it is difficult to foresee a Scottish Government of any party (likely to be elected) changing it.

So, this report does not deliver the ‘strong Conservative principles of responsibility, transparency and accountability’. It would not affect Scottish Parliament accountability in any meaningful way. All the report does is demonstrate the Scottish Conservatives are going further than Scottish Labour, which is not very far at all. It’s a classic case of good politics, bad policy.

See also: Robert Peston Could Scotland compete on tax with Westminster?

 

 

 

 

9 Comments

Filed under Scottish politics

9 responses to “The Scottish Conservative plans for tax are about as good as you can do under devolution, but that’s not saying much

  1. Pingback: Devo-Max: Does it mean the maximum you WANT or the maximum you CAN HAVE? | Paul Cairney: Politics & Public Policy

  2. Pingback: Would Scottish Independence Save the NHS and Keep Education Free? | Paul Cairney: Politics & Public Policy

  3. Pingback: What is the Barnett Formula? | Paul Cairney: Politics & Public Policy

  4. Pingback: Scottish Independence: beware the Constitutional Convention? | Paul Cairney: Politics & Public Policy

  5. Pingback: Aileen McHarg: The Vow: Vote No for More Devo | UK Constitutional Law Association

  6. Pingback: What will devo-max mean? | Paul Cairney: Politics & Public Policy

  7. Pingback: Early thoughts on the SNP conference: 2 speeches postponing independence and social democracy | Paul Cairney: Politics & Public Policy

  8. Pingback: The final Scottish devolution settlement is rubbish, and unionists should be worried | Paul Cairney: Politics & Public Policy

  9. Pingback: Is politics and policymaking about sharing evidence and facts or telling good stories? Two very silly examples from #SP16 | Paul Cairney: Politics & Public Policy

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s