Time to Start Answering Questions
The final deadline for income tax returns has now passed. Cue for unwelcome hundred pound fines for some but also time for the Treasury to calculate how much revenue the fifty pence top rate of income tax has generated.
The fifty pence rate has become the source of much political debate in recent weeks and months. There is a clear division in the Tory Liberal administration at Westminster between those who support the message it sends out about fairness in these difficult times and those who can’t wait to see the back of such supposed attacks on the rich. Labour politicians have defended the principle that those who have more should contribute more, particularly as the alternative would mean even deeper cuts to our schools, hospitals and caring services. Losing the fifty pence rate would also leave a big hole in the Scottish public finances – possibly to the tune of £200 million or more.
Why then the silence of the First Minister on the subject?
For the most part, the First Minister and the SNP have managed to avoid all of the big and difficult questions around separation. It is not difficult to see why. Last week when challenged on what he called the economic case for separation, the First Minister immediately ran into difficulties; on Scotland’s relationship with the Bank of England; on who sets our interest rates; on our currency, on public borrowing and more. The SNP have no difficulty talking about the process leading up to a referendum but seem reluctant to engage in the argument that really matters, on what follows separation and the risks and benefits to Scotland.
I believe that what most Scots really want to know is how will separation affect their lives, their pension, their mortgage, their job – and the taxes they pay. SNP Ministers constantly demand control over all the ‘economic levers of power’, but then refuse to say what they would do with those levers of control.
In the case of interest rates, the First Minister has admitted the first thing he would do on leaving the union would be to re-negotiate a new currency union, initially with the rest of the UK, then with the Eurozone. But where does he stand on taxation? He talks of taking control of corporation tax so that it could be cut here in Scotland, the price would of course be a cut in support for the elderly, education or the police. But what about personal taxation? The First Minister talks about Scotland being a progressive country so defending the fifty pence rate should be a simple starter for him.
I have two concerns; one is that if the First Minister genuinely believes in a progressive society, he should be out there now defending the fifty pence rate against the Tories rather than just leaving the difficult arguments for Labour. The SNP want to appear, and to appeal, as a modern progressive social democrat party, but without getting their hands dirty. Talking about the benefits of a welfare state but without making the case as to how we pay for it is the clear sign of a populist approach, not a progressive one.
My second concern is simply to hear the SNP state, on the record, what their plans are for our economy post separation. The SNP make out that we can oppose the Tory welfare cuts if only we were a separate country, but we know that we can’t have higher spending and lower taxes. In truth there are people right across the UK, in England, Scotland, Wales and Northern Ireland, who all oppose these welfare reforms. The problem is, not that they are coming from Westminster, but because they are coming from the Tories.
There are a lot of difficult questions for the SNP to answer but whether Scots will pay a fifty pence top rate of income tax should be an easy one for the First Minister. It’s time he started answering.
Ken Macintosh is Scottish Labour MSP for Eastwood and Shadow Cabinet Secretary for Finance, Employment and Sustainable Growth. Follow him on Twitter: @KenMacintoshMSP