Income tax thresholds freeze means marginally reduced take-home pay for Scots

Jenny Stewart, KPMG UK’s head of infrastructure, government and healthcare in Scotland, said: “Today, the Chancellor chose to freeze income tax thresholds in the UK budget – the level at which higher tax rates come into effect. We can therefore now calculate the difference in take home pay – after tax and National Insurance – for tax payers in Scotland, compared to those in England.

“Scottish Taxpayers earning £50,000, will take home 4.1% less - after income tax and National Insurance – than someone earning the same salary in England. How will that affect the economy in the future? The extra tax of £1,542 may not cause significant numbers to move out of Scotland now, but will it discourage aspiring graduates and those in the tech sector from coming to Scotland in future? Or will those individuals be attracted to Scotland – given the different public service offering here - as Scottish Government hopes? For those on lower incomes, a Scottish Taxpayer earning £20,000 will pay £20.85 less tax than someone earning the same amount in England for 2020/21.”

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