Progressive taxation reinforced in Scottish Budget
The draft Scottish Budget 2026-27, announced by Finance Secretary Shona Robison on 13 January, maintained the government’s commitment to progressive taxation, with the thresholds for higher and advanced rates of tax remaining unchanged.
The finance secretary did deliver some welcome news in announcing that the thresholds at which the basic and intermediate rates of tax bite will be increased by 7.4%. However, to put into some perspective, this equates to a maximum tax-saving for an individual of around £32 per annum.
The high rates of tax that will continue to apply means that careful income and remuneration planning for individuals and employers remains essential.
A higher-rate ‘mansion tax’, similar to what is planned for England, is also set to apply to properties worth more than £1 million from April 2028.
Non-domestic rates
For businesses, continued pressure from non-domestic rates remains a key concern. Longer-term reform coupled with targeted reliefs for retail, hospitality and other high-street sectors is still needed to support competitiveness and investment.
The government has aimed to balance fiscal constraints with social priorities but in so doing has added more complexity to the tax landscape.
We’re here to help
Businesses and individuals in Scotland should review their tax positions early to understand the full impact of the threshold rises and plan for the year ahead.
If you have any questions or would like tailored advice, get in touch with out Tax specialists via the form below.
