Pre-budget scrutiny 2020-21

PDF Published: Tuesday 12 Nov 2019 (FCCS51909)

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Overview
Report

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Overview
Report
- Introduction
- Economic Performance
- Scottish Income Tax 2017/18 – Reconciliation Process
  - Earnings Growth
    
    Welsh Fiscal Framework
    
    Managing the Risk
    
    Transparency
    
    Data
- Policy spillovers
  - Personal Allowance
- Additional Dwelling Supplement
  - Context
  - Operation of ADS
- VAT assignment
- Conclusion
- Introduction
- Economic Performance
- Scottish Income Tax 2017/18 – Reconciliation Process
- Policy spillovers
- Additional Dwelling Supplement
- VAT assignment
- Conclusion
Sources

Image: Table 1 - GDP Growth Outturn Figures …

Image: Scottish Income Tax 2017/18 – Reconciliation Process …

Image: Chart 1: Average Scottish earnings as a percentage of average UK earnings …

Image: Chart 2: Growth in PAYE earnings employment per taxpayer …

Image: Earnings Growth …

Image: Chart 3: Wage Inequality: Ratio of 90th to 10th Percentile for Full-Time Workers …

Image: Chart 4: Growth in annual earnings across the income distribution, 2017 - 2018 …

Scottish Government's Medium Term Financial Strategy: May 2019. (2019, May 30). Retrieved from https://www.gov.scot/publications/scotlands-fiscal-outlook-scottish-governments-medium-term-financial-strategy-2019/ [accessed 1 October 2019]

Scotland's Economic and Fiscal Forecasts May 2019. (2019, May 30). Retrieved from http://www.fiscalcommission.scot/publications/scotlands-economic-and-fiscal-forecasts/scotlands-economic-and-fiscal-forecasts-may-2019/ [accessed 1 October 2019]

Scottish Income Tax: Experimental Statistics 2016-17 & 2017-18. (2019, July 18). Retrieved from https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/817259/Scottish_Income_Tax_Outturn_Statistics_2019.pdf [accessed 1 October 2019]

Fiscal Framework Data Update. (2019, July). Retrieved from https://www.gov.scot/binaries/content/documents/govscot/publications/transparency-data/2019/07/fiscal-framework-outturn-report-data-update/documents/fiscal-framework-data-update-july-2019/fiscal-framework-data-update-july-2019/govscot%3Adocument/Fiscal%2BFramework%2BData%2BUpdate%2B-%2BJuly%2B2019.pdf [accessed 1 October 2019]

Forecast Evaluation Report September 2019. (2019, September 4). Retrieved from http://www.fiscalcommission.scot/publications/forecast-evaluation-reports/forecast-evaluation-report-september-2019/ [accessed 1 October 2019]

Fiscal framework outturn report: 2019. (2019, September 26). Retrieved from https://www.gov.scot/publications/fiscal-framework-outturn-report-september-2019/ [accessed 1 October 2019]

The agreement between the Scottish Government and the United Kingdom Government on the Scottish Government’s ? scal framework. (2016, February). Retrieved from https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/503481/fiscal_framework_agreement_25_feb_16_2.pdf [accessed 1 October 2019]

Official Report, Finance and Constitution Committee, 5 June 2019, Col 21. (n.d.)

Scottish Government's Medium Term Financial Strategy: May 2019, page 4. (2019, May 30). Retrieved from https://www.gov.scot/publications/scotlands-fiscal-outlook-scottish-governments-medium-term-financial-strategy-2019/ [accessed 1 October 2019]

Finance and Constitution Committee 12 June 2019, Derek Mackay, contrib. 12, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12186&c=2186504

Scotland’s Economic and Fiscal Forecasts May 2019 , paragraph 2.59. (2019, May 30). Retrieved from http://www.fiscalcommission.scot/media/1499/scotlands-economic-and-fiscal-forecasts-may-2019.pdf [accessed 5 November 2019]

Official Report, Finance and Constitution Committee, 12 June 2019, Col 2. (n.d.)

Finance and Constitution Committee 05 June 2019, Professor Smith, contrib. 90, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12177&c=2184539

Fraser of Allander Blog. (2019, July 18). Retrieved from https://fraserofallander.org/scottish-economy/tax/todays-income-tax-reconciliations-from-hmrc-confirmed-200m-shortfall-in-funding-to-hit-next-year/ [accessed 5 November 2019]

Forecast Evaluation Report September 2019 , paragraph 2.20. (2019, September 4). Retrieved from http://www.fiscalcommission.scot/publications/forecast-evaluation-reports/forecast-evaluation-report-september-2019/ [accessed 5 November 2019]

Finance and Constitution Committee 2nd Report 2019. Report on Scottish Government Budget 2019-20 paragraph 110. (2019, January 25). Retrieved from https://www.parliament.scot/S5_Finance/Reports/Budget_Report_201920_-_FINAL.pdf [accessed 5 November 2019]

Official Report, Finance and Constitution Committee, 5 June 2019 Col 5. (n.d.)

Official Report, Finance and Constitution Committee, 5 June 2019, Col 6. (n.d.)

Official Report, Finance and Constitution Committee, 5 June 2019, Col 7. (n.d.)

Official Report, Finance and Constitution Committee, 5 June 2019, Col 18. (n.d.)

Scotland’s new financial powers Operation of the Fiscal Framework 2018/19. (2019, October). Retrieved from https://www.audit-scotland.gov.uk/uploads/docs/report/2019/briefing_191017_financial_powers.pdf [accessed 5 November 2019]

Scotland’s new financial powers Operation of the Fiscal Framework 2018/19, paragraph 76. (2019, October). Retrieved from https://www.audit-scotland.gov.uk/uploads/docs/report/2019/briefing_191017_financial_powers.pdf [accessed 5 November 2019]

Official Report, Finance and Constitution Committee, 24 April 2019, Col 8. (n.d.)

Finance and Constitution Committee 24 April 2019, Professor Bell, contrib. 42, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12061&c=2170199

Official Report, Finance and Constitution Committee, 24 April, Col 15. (n.d.)

Written evidence from Professor David Bell. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/Meeting%20Papers/public_papers(2).pdf [accessed 5 November 2019]

Official Report, Finance and Constitution Committee, 12 June 2019, Col 12. (n.d.)

Official Report, Finance and Constitution Committee, 2 October 2019 Col 17. (n.d.)

The agreement between the Welsh government and the UK government on the Welsh government’s fiscal framework. (2016, December 19). Retrieved from https://www.gov.uk/government/publications/the-agreement-between-the-welsh-government-and-the-united-kingdom-government-on-the-welsh-governments-fiscal-framework [accessed 5 November 2019]

Fair Funding for Taxing Times? Report by Wales Governance Centre, February 2017. (2017, February). Retrieved from https://www.cardiff.ac.uk/__data/assets/pdf_file/0008/1287233/Fair-Funding-for-Taxing-Times-Assessing-the-Fiscal-Framework-Agreement.pdf

SPICe Briefing, The Scottish Government's MediumTerm Financial Strategy, May 2019. (2019, June 11). Retrieved from https://bprcdn.parliament.scot/published/2019/6/11/The-Scottish-Government-s-Medium-Term-Financial-Strategy--May-2019/SB%2019-39.pdf [accessed 5 November 2019]

Fraser of Allander Blog, Medium Term Financial Strategy: where’s the medium-term focus or strategy?. (2019, June 5). Retrieved from https://fraserofallander.org/scottish-economy/fiscal-policy/medium-term-financial-strategy-wheres-the-medium-term-focus-or-strategy/ [accessed 5 November 2019]

The 2018/19 audit of the Scottish Government Consolidated Accounts. (2019, September). Retrieved from https://www.audit-scotland.gov.uk/uploads/docs/report/2019/s22_190926_scottish_gov.pdf [accessed 5 November 2019]

Scotland’s new financial powers Operation of the Fiscal Framework 2018/19, paragraph 130. (2019, October). Retrieved from https://www.audit-scotland.gov.uk/uploads/docs/report/2019/briefing_191017_financial_powers.pdf [accessed 5 November 2019]

Scotland’s Economic and Fiscal Forecasts May 2019 , paragraph 13. (2019, May 30). Retrieved from http://www.fiscalcommission.scot/media/1499/scotlands-economic-and-fiscal-forecasts-may-2019.pdf [accessed 5 November 2019]

Official Report, Finance and Constitution Committee, 12 June 2019, Col 9. (n.d.)

No title (n.d.) Retrieved from Official Report, Finance and Constitution Committee, 12 June 2019, Col 6

HM Treasury Pres Release Scottish Income Tax shortfall offset by UK Funding. (2019, July 18). Retrieved from https://www.gov.uk/government/news/scottish-income-tax-shortfall-offset-by-uk-funding [accessed 5 November 2019]

Scottish Government press release Scottish income tax revenues grew by 1.8% in 2017-18. (2019, July 18). Retrieved from https://www.gov.scot/news/scottish-income-tax-revenues-grew-by-1-8-percent-in-2017-18/ [accessed 5 November 2019]

Fraser of Allnder Blog Has the Scottish Government received a £700m ‘bail-out’ from the UK Government?. (2019, July 22). Retrieved from https://fraserofallander.org/scottish-economy/fiscal-policy/has-the-scottish-government-received-a-700m-bail-out-from-the-uk-government/ [accessed 5 November 2019]

Letter from Sir David Norgrove to Derek Mackay. (2019, August 13). Retrieved from https://www.statisticsauthority.gov.uk/correspondence/income-tax-reconciliations-for-scotland/ [accessed 5 November 2019]

Letter from Mary Gregory to Tom Orford. (2019, August 13). Retrieved from https://www.statisticsauthority.gov.uk/correspondence/scotlands-block-grant-adjustment/ [accessed 5 November 2019]

Fraser of Allander Blog, Has the Scottish Government received a £700m ‘bail-out’ from the UK Government?. (2019, July 22). Retrieved from https://fraserofallander.org/scottish-economy/fiscal-policy/has-the-scottish-government-received-a-700m-bail-out-from-the-uk-government/ [accessed 5 November 2019]

The agreement between the Scottish government and the United Kingdom government on the Scottish government’s fiscal framework. (2016, February 25). Retrieved from https://www.gov.uk/government/publications/the-agreement-between-the-scottish-government-and-the-united-kingdom-government-on-the-scottish-governments-fiscal-framework [accessed 14 August 2019]

Letter from the Convener to the Chief Secretary to the Treasury. (2019, May 8). Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/20190508_-_Convener_to_CST.pdf [accessed 17 September 2019]

Letter from the CST to the Convener. (2019, May 30). Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Personal_Allowance_Policy_Spillovers.pdf [accessed 17 September 2019]

Letter from the Cabinet Secretary, 25 October 2019. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Letter_from_DM_to_FCC.pdf [accessed 5 November 2019]

Finance and Constitution Committee, 29 May 2019. Official Report. (n.d.) Retrieved from http://www.parliament.scot/parliamentarybusiness/report.aspx?r=12131

Finance and Constitution Committee, 12 June 2019. Official Report.. (n.d.) Retrieved from http://www.parliament.scot/parliamentarybusiness/report.aspx?r=12186

Finance and Constitution Committee 12 June 2019, The Minister for Public Finance and Digital Economy (Kate Forbes), contrib. 183, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12186&c=2186675

Letter from the Convener to the Minister, 26 June 2019.. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/2019.6.27_Kate_Forbes_ADS.pdf

Letter from the Minister to the Convener, 15 July 2019.. (n.d.) Retrieved from https://www.parliament.scot/S5_Public_Audit/General%20Documents/Correspondence_from_the_Minister_for_Public_Finance_and_Digital_Economy_-_15-07-19_-_BC.pd.pdf

Letter from the Minister, 28 October 2019. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Letter_from_KF_to_FCC_on__LBTT_ADS.pdf [accessed 5 November 2019]

Letter from Revenue Scotland, 31 October 2019. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Revenue_Scotland.pdf [accessed 5 November 2019]

Finance and Constitution Committee, 13 March 2019. Official Report. (n.d.) Retrieved from http://www.parliament.scot/parliamentarybusiness/report.aspx?r=11998

Letter from the Convener to the Cabinet Secretary, March 2019.. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Letter_to_Derek_Mackay_re_VAT.pdf

Letter from the Cabinet Secretary to the Convener, April 2019.. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/2019.4.17_-_Derek_Mackay_to_Convener_on_VAT_assignment_in_Scotland.pdf

Finance and Constitution Committee, 8 May 2019. Official Report. (n.d.) Retrieved from http://www.parliament.scot/parliamentarybusiness/report.aspx?r=12087

Finance and Constitution Committee 08 May 2019, Derek Mackay, contrib. 57, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12087&c=2173999

Finance and Constitution Committee 08 May 2019, Derek Mackay, contrib. 59, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12087&c=2174001

Finance and Constitution Committee 08 May 2019, Derek Mackay, contrib. 125, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12087&c=2174067

Letter from the Cabinet Secretary to the CST. (2019, May 15). Retrieved from https://www.parliament.scot/S5_HealthandSportCommittee/General%20Documents/20190515_-_Derek_Mackay_to_CST_-_VAT.pdf [accessed 25 September 2019]

Finance and Constitution Committee 02 October 2019 [Draft], Derek Mackay, contrib. 68, http://www.scottish.parliament.uk/parliamentarybusiness/report.aspx?r=12298&c=2205768

Letter from the Cabinet Secretary, 28 October 2019. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/Letter_from_DM_to_FCC.pdf [accessed 5 November 2019]

Letter from the CST, 31 October 2019. (n.d.) Retrieved from https://www.parliament.scot/S5_Finance/General%20Documents/20191031_-_Letter_from_CST_-_20191031_-_Copy.pdf

Letter from the Cabinet Secretary, 2 November 2019. (n.d.) Retrieved from https://www.parliament.scot/S4_FinanceCommittee/General%20Documents/VAT_assignment_-_letter_to_Finance_Committee_-_Nov_19.pdf

Last Updated: 4/4 12:09am

Image: Table 1 - GDP Growth Outturn Figures …

Image: Scottish Income Tax 2017/18 – Reconciliation Process …

Image: Scottish Income Tax 2017/18 – Reconciliation Process …

Image: Chart 1: Average Scottish earnings as a percentage of average UK earnings …

Image: Chart 2: Growth in PAYE earnings employment per taxpayer …

Image: Earnings Growth …

Image: Chart 3: Wage Inequality: Ratio of 90th to 10th Percentile for Full-Time Workers …

Image: Chart 4: Growth in annual earnings across the income distribution, 2017 - 2018 …

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