Middle-class Scots are on course to pay around £2,000 more in Income Tax annually than if they lived in England, unless the Scottish Government follows Chancellor Rishi Sunak's tax-cut plan announced yesterday.
A worker north of the border earning £50,000 per year already pays almost £1,500 more Income Tax per year than someone on the same salary in England, reports the Telegraph.
But the gap could grow to £1,863 after Mr Sunak revealed in the spring budget that the basic rate of Income Tax in England will be cut from 20% to 19% in 2024.
The Chartered Institute of Taxation calculates the additional sum paid by Scottish workers earning £60,000 would rise from around £1,643 to £2,020. For those earning £100,000, the cross-border tax gap would widen from £2,043 to £2,420.
Following the budget speech, Scottish Government Finance Secretary Kate Forbes claimed the Chancellor has failed to help thousands of worried households facing poverty.
She said the Scottish Government was doing all it could to tackle the cost-of-living crisis.
The Finance Secretary added: "On taxation, we have already acted to introduce a 19% starter rate of Income Tax below the basic rate, in line with our commitment to progressive taxation, which makes Scotland the fairest-taxed part of the UK. We will continue to take that approach when we set taxation policy in future budgets."
Another of the main headlines from yesterday's budget was a 5p per litre cut in fuel duty, as motorists struggle with record fuel prices.
Mr Sunak said the move, which will last until next March, was "the biggest cut to all fuel duty rates ever".
However, the RAC added that the 5p cut only took prices "back to where they were just over a week ago".
Motorists have been hit by record pump prices since Russia's invasion of Ukraine led to an increase in the cost of oil because of supply fears.
The BBC states that average pump prices hit new records on Tuesday, with petrol topping £1.67 a litre and diesel close to hitting £1.80 for the first time, the RAC said.
Also in the budget, the Chancellor resisted calls to scrap April's National Insurance rise of 1.25p in the pound.
Labour claimed he had made an "historic mistake" by pushing ahead with the National Insurance increase, which the party warned would hit workers hard.
But Mr Sunak said the money raised was needed for the NHS - and instead he said he would raise the threshold at which workers start paying National Insurance from £9,600 to £12,570.
This would amount to "a £6billion personal tax cut for 30million people across the United Kingdom, a tax cut for employees worth over £330 a year", added the Chancellor.
Meanwhile, it emerged yesterday that the UK is facing its biggest drop in living standards on record as wages fail to keep pace with rising prices.
Soaring energy costs could push inflation to a 40-year high of 8.7% in the final three months of 2022.
Rising prices and tax hikes mean living standards will not recover to their pre-pandemic level until 2024-25, the Office for Budget Responsibility said.
Living standards - disposable household incomes when adjusted for inflation - are expected to drop by 2.2% this year, the OBR added.
That would be their largest fall in a financial year since records began in 1956.