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Ais-eòlas
Published by The Scottish Parliamentary Corporate Body
Scottish Budget 2026-27
Author: Ailsa Burn-Murdoch, Rachel Cook, Kelly Eagle, Andrew Feeny-Seale, Nicola Hudson, Greig Liddell and Rob Watts
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Published: Friday 16 Jan 2026 (SB 26-04)
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Overview
Report
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Overview
Report
Executive Summary
Some minor changes to taxation policy
Social security spending is the biggest winner in 2026-27
Local government allocations grow ahead of inflation
The Budget is accompanied by some long-awaited medium-term plans
The outlook for capital funding is particularly restricted
Non-domestic rates (NDR) relief
Transparency remains a challenge
Context for Scottish Budget 2026-27
Baseline issue
Budget overview
Scottish Spending Review
Eradicating child poverty
Growing the economy
Tackling the climate emergency
Sustainable public services
Scottish Budget funding
The outlook for Scotland’s economy
GDP
Productivity
Inflation
Labour market and earnings
Portfolios at a glance
Health and Social Care
Finance and Local Government
Social Justice
Education and Skills
Justice and Home Affairs
Transport
Deputy First Minister, Economy and Gaelic
Housing
Rural Affairs, Land Reform and Islands
Climate Action and Energy
Constitution, External Affairs and Culture
Local Government
Revenue allocation
More on the ABR to Budget comparison
Council tax in 2026-27
New council tax bands from 2028
Verity House agreement
Capital allocation
Taxation
Income tax
Income tax proposals
Impact on individuals
The commitment to ensure most Scottish taxpayers pay less income tax than they would in the rest of the UK
Income tax revenues
Income tax net position
Income tax reconciliation
Taxation on income from property
Non-domestic rates
Retail, Hospitality and Leisure relief
Revaluation-related transitional reliefs
Non-domestic rates forecasts?
Land and Building Transaction Tax
Scottish Landfill Tax (SLfT)
Scottish Aggregates Tax
Airport Departure Tax and Private Jet Supplement
Building Safety Levy
Other potential taxes
VAT Assignment
Carbon Land Tax
Wealth tax
Social security
Policy announcements
Detail of social security spending
Spending by the Scottish Government
Impact on the rest of the Scottish Budget
Capital and infrastructure
Borrowing powers
Financial transactions
Scottish Government Bonds
Infrastructure
Climate change, taxonomy and carbon assessments of the budget
Carbon assessment
Taxonomy of capital and resource spending
Capital
Resource
Adaptation and mitigation
Public sector
Public sector pay policy
Public service reform
Related Briefings
Related Briefings
Sources
Image: Figure 2: Total Managed Expenditure
Image: Figure 3: Resource and capital allocations by portfolio area
Image: Figure 4: Real terms changes in portfolio spending
Image: Figure 20: Forecast tax revenues
Image: Figure 27: Total capital budget, 2026-27, £ million
Image: Figure 28: Key policy and budget allocations expected to contribute to meeting the Scottish Government climate goals in 2026-27
Image: Figure 1: Baselines matter
Image: Figure 5: Forecasted growth domestic product (GDP) growth, Scotland, real terms, 2025-26 to 2030-31
Image: Figure 6: CPI inflation, year-on-year growth
Image: Figure 7: Forecasted nominal average earnings growth, SFC and OBR, 2026-27 to 2030-31
Image: Figure 8: Health and Social Care Budget 2026-27 at a glance
Image: Figure 9: Finance and Local Government Budget 2026-27 at a glance
Image: Figure 10: Social Justice Budget 2026-27 at a glance
Image: Figure 11: Education and Skills Budget 2026-27 at a glance
Image: Figure 12: Justice and Home Affairs Budget 2026-27 at a glance
Image: Figure 13: Transport Budget 2026-27 at a glance
Image: Figure 14: Deputy First Minister, Economy and Gaelic Budget 2026-27 at a glance
Image: Figure 15: Housing Budget 2026-27 at a glance
Image: Figure 16: Rural Affairs, Land Reform and Islands Budget 2026-27 at a glance
Image: Figure 17: Climate Action and Energy Budget 2026-27 at a glance
Image: Figure 18: Constitution, External Affairs and Culture Budget 2026-27 at a glance
Image: Figure 19: proportion of total revenue allocation either ring-fenced or transferred in-year
Image: Figure 23:?Non-domestic rates?and?thresholds, 2024-25 to?2026-27
Image: Figure 24: Forecast income from Land and Buildings Transaction Tax
Image: Figure 25: Forecast income from Scottish Landfill Tax
Image: Figure 29: Greenhouse gas emissions associated with Scottish budgets, 2010-11 to 2026-27
Image: Figure 30: Carbon intensity of Scottish Budgets, total emissions compared to Total Managed Expenditure, since 2010-11
Image: Figure 33: Planned efficiencies and savings by portfolio area for 2026-27 to 2028-29
Image: Figure 21: Scottish NSND income tax forecasted revenues
Image: Figure 22: Income tax net position, £ million
Image: Figure 26: Devolved Social Security spend for 2026-27
Image: Figure 31: Capital spending taxonomy, 2026-27
Image: Figure 32: Resource spending taxonomy, 2026-27
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Scottish Government. (2026, January 13). Scottish Budget 2026 to 2027. Retrieved from
https://www.gov.scot/publications/scottish-budget-2026-2027
[accessed 16 January 2026]
HM Treasury. (2025, November 26). Budget 2025. Retrieved from
https://www.gov.uk/government/collections/budget-2025
[accessed 16 January 2026]
HM Treasury. (2025, June 11). Spending Review 2025. Retrieved from
https://www.gov.uk/government/collections/spending-review-2025
[accessed 16 January 2026]
Scottish Fiscal Commission. (2026, January 13). Scotland’s Economic and Fiscal Forecasts – January 2026. Retrieved from
https://fiscalcommission.scot/publications/scotlands-economic-and-fiscal-forecasts-january-2026/
[accessed 16 January 2026]
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