Treasury in 'tax freedom' warning


Tax Time

Independence could mean workers in Scotland achieving "tax freedom" two weeks later than people south of the border, the UK Treasury has claimed.

Tax Freedom Day is calculated by experts at the Adam Smith Institute as being the date in the calendar when people in Britain stop working for the Treasury and begin to earn for themselves.

But Chief Secretary to the Treasury Danny Alexander said that as Scotland would have a higher deficit than the UK, that could leave taxpayers working for longer before they reach this date if there was a Yes vote in September's referendum.

The UK Government minister said that as the deficit in an independent Scotland would be £1,000 higher per person, people would have to work for longer before reaching "tax freedom".

While Tax Freedom Day in the UK falls on May 28 this year, Treasury analysis suggests that in an independent Scotland it could be some 16 days later, on June 13.

Mr Alexander raised the issue ahead of the publication of a major new Treasury report looking at Scotland's fiscal position, should it become independent, from 2016 to 2035-36.

The Chief Secretary to the Treasury said:"As Scotland's deficit would be £1,000 per head higher than the UK average in 2016-17, taxpayers in an independent Scotland could face working even longer before reaching tax freedom.

"The Treasury will today publish the most comprehensive analysis of the fiscal position of Scotland yet produced, which will set out the scale of the UK dividend for Scotland."

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