The Chartered Institute of Taxation (CIOT) is cautioning that the decision to postpone the UK Budget will damage the Scottish Parliament’s ability to scrutinise tax and spending plans ahead of the new tax year.
The Chancellor told the BBC this morning that the UK Budget would not be going ahead as planned on 6 November because of Brexit legislation and the UK Government’s desire to have a General Election in December.
The CIOT is warning that the lack of a UK Budget will significantly hinder the ability of the Scottish Government to produce its own Budget, currently pencilled in for 12 December but itself subject to possible delay1.
The Institute has also warned that further delays will limit the time available to MSPs to scrutinise and approve tax changes before that start of the new tax year in April, throwing into chaos the budget process initiated following the 2017 Budget Process Review Group2.
The absence of tax and spending decisions at Westminster will also leave Holyrood without Scotland’s full fiscal picture.
Alexander Garden, chair of the Chartered Institute of Taxation’s Scottish Technical Committee, said:
“Scotland’s budget process has potentially become the latest victim of Britain’s Brexit impasse.
“In any normal year, there would already be many moving parts to the Scottish Budget process. Today’s announcement only complicates matters further and leaves Derek Mackay in a tight corner.
“He could choose to go it alone and publish Scotland’s budget before Westminster, but he would be doing so with one hand tied behind his back, oblivious to Westminster’s tax and spending choices
“This matters because these decisions continue to have an impact on the overall amount of money available to Scotland, making it is unlikely he would follow this path.
“The second choice would be wait until after a UK Budget, which may not come until January, a move that could run roughshod over the Budget scrutiny procedures agreed by MSPs in the Budget Process Review Group. This would limit opportunities for scrutiny as well as leaving less room than normal to react to tax changes made at Westminster.
“One of these options will be exacting, the other, impractical. A halfway house isn’t easy to construct and no option seems appealing”.
Notes for editors
1. On 2 October, Derek Mackay told the Finance and Constitution Committee that a lack of detail from the UK Budget would make his own budget planning “immeasurably more difficult” (see - http://www.parliament.scot/parliamentarybusiness/report.aspx?r=12298&i=111184&c=2205705#ScotParlOR)
2. A visual guide to the revised Scottish Budget process can be found at this link.
3. A picture of Alexander Garden can be downloaded via the following link.
The Chartered Institute of Taxation
The CIOT is the leading professional body in the United Kingdom concerned solely with taxation. The CIOT is an educational charity, promoting education and study of the administration and practice of taxation. One of our key aims is to work for a better, more efficient, tax system for all affected by it – taxpayers, their advisers and the authorities. The CIOT’s work covers all aspects of taxation, including direct and indirect taxes and duties. Through our Low Incomes Tax Reform Group (LITRG), the CIOT has a particular focus on improving the tax system, including tax credits and benefits, for the unrepresented taxpayer.
Contact: Hamant Verma, External Relations Officer, 0207 340 2702 HVerma@ciot.org.uk
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