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Chamber and committees

Official Report: search what was said in Parliament

The Official Report is a written record of public meetings of the Parliament and committees.  

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Dates of parliamentary sessions
  1. Session 1: 12 May 1999 to 31 March 2003
  2. Session 2: 7 May 2003 to 2 April 2007
  3. Session 3: 9 May 2007 to 22 March 2011
  4. Session 4: 11 May 2011 to 23 March 2016
  5. Session 5: 12 May 2016 to 4 May 2021
  6. Current session: 13 May 2021 to 29 December 2025
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Displaying 4060 contributions

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Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

It is like someone earning £99,500 and not wanting to be promoted because then they will lose their £12,570 tax-free allowance, for example. That is obviously under UK control, of course.

The statistics that you mention in exhibit 10 are interesting. It was hoped that £65 million would be raised when the additional rate increased and the threshold was lowered in 2023-24, but 83 per cent of that was lost due to behavioural change, leaving only £11 million. The following year, when the top rate was increased, 85 per cent was lost—these are quite significant figures—and effectively only £5 million was brought in. Taxes are being levied that obviously cause some individuals pain, and the money is effectively being lost. I have no doubt that there is an impact on productivity if folk are working fewer hours and so on as well.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Thank you. I will not ask about the tax base performance gap because I am quite sure that colleagues want to dig into that in some detail.

I was surprised, though, by the comment in paragraph 40 that the percentage of people who state they do not understand taxes well is around 50 per cent. I thought that it would be much higher than that. I think that the number of people who do not understand what taxes are devolved and reserved is infinitely higher than 50 per cent. I think that you would be quite shocked. People do not realise that excise duties or VAT or whatever are reserved; there is corporation tax, inheritance tax, you name it. I think that there is real surprise about what is and what is not under the control of this Parliament.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Talking to constituents over many years, I have found that most of them are quite astonished when they find out that council tax does not provide 100 per cent of local authority funding. When you tell them that it is probably 14 or 15 per cent, they are quite amazed.

In paragraph 10 of the report you say that

“This audit focuses on taxes devolved through the Scotland Acts 2012 and 2016”

but that it is not about non-domestic rates or council tax. Would you like to be able to include those in future?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

It could make a more rounded picture.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I will open up the session to colleagues.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I have a further concern on transparency and communication. In exhibit 1, you say about VAT assignment:

“To date there has been no agreement between the Scottish and UK Governments on a way forward for the implementation of VAT assignment.”

You continue in paragraph 5 to say:

“In July 2025, the Scottish Affairs Committee of the UK Parliament raised concerns over progress”.

This committee has consistently and repeatedly said that we do not believe that VAT assignment would be of any benefit whatsoever to Scotland. It would cost millions of pounds to set up. There would be arguments between Scotland and the UK over the levels of assignment—blah, blah, blah. There would be no control whatsoever in this Parliament of the VAT level. The view of this committee, expressed to the Scottish Government over many years, is that it is a complete waste of time. I see no reference to that in here; it is as if we are still a week after the Smith commission report has been published and we are just looking at when this will be implemented. I would hope that, in future reports, you would make it clear that we feel that this is a dead duck and that it is a waste of time to talk about it. We could talk about devolving VAT—that is another argument—but we do not feel that assignment should be progressed.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Of course, in the next financial year, we face a £1 billion gap in resource funding and £1.1 billion gap in capital funding, as you say in paragraph 41. Do you expect that gap to be closed in the next financial year?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

That concludes questions from me and my colleagues. Are there any further points that you or Richard Robinson would like to make before we wind up the session?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Thank you very much. We all have your report right in front of us. I will ask you some questions that you have answered in your report, but I am quite keen to get some of that on the public record.

In your opening statement, you highlighted transparency. Can you talk us through your frustrations with the Government’s lack of transparency and how it can be improved?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Yes, LBTT contributes 1.6 per cent of the Scottish budget, so it is not insignificant.