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| Scottish budget: No change in Scottish income tax rate | Scottish budget: No change in Scottish income tax rate |
| (35 minutes later) | |
| The finance secretary John Swinney has ruled out an increase in Scottish income tax when Holyrood gets new financial powers next year. | The finance secretary John Swinney has ruled out an increase in Scottish income tax when Holyrood gets new financial powers next year. |
| Mr Swinney made the announcement as he unveiled his draft budget to MSPs in the Scottish Parliament. | Mr Swinney made the announcement as he unveiled his draft budget to MSPs in the Scottish Parliament. |
| He also announced a tax rise on many second homes and buy-to-let properties through a Land and Buildings Transaction Tax levy | He also announced a tax rise on many second homes and buy-to-let properties through a Land and Buildings Transaction Tax levy |
| And Mr Swinney confirmed that the council tax freeze would continue. | And Mr Swinney confirmed that the council tax freeze would continue. |
| The finance secretary warned that the Scottish budget was set to continue to reduce in real terms until the end of the decade, as he said it had done since 2010. | The finance secretary warned that the Scottish budget was set to continue to reduce in real terms until the end of the decade, as he said it had done since 2010. |
| Opposition parties claimed the Mr Swinney was "following where the Conservatives lead". | |
| Holyrood will be given limited powers over income tax rates next April under the 2012 Scotland Act, which was passed under the previous UK coalition government. | Holyrood will be given limited powers over income tax rates next April under the 2012 Scotland Act, which was passed under the previous UK coalition government. |
| It will see the Treasury deduct from the Scottish block grant a sum equivalent to the product of 10p worth of income tax north of the border. | It will see the Treasury deduct from the Scottish block grant a sum equivalent to the product of 10p worth of income tax north of the border. |
| Mr Swinney then had the option of setting a Scottish Rate of Income Tax (SRIT) which could either be lower, higher or the same as the 10p that has been deducted. | Mr Swinney then had the option of setting a Scottish Rate of Income Tax (SRIT) which could either be lower, higher or the same as the 10p that has been deducted. |
| The finance secretary told the Holyrood chamber: "I propose that the Scottish Rate of Income Tax will be set at 10p in the pound - the rate people pay this year will be the same rate that they will pay next year. | The finance secretary told the Holyrood chamber: "I propose that the Scottish Rate of Income Tax will be set at 10p in the pound - the rate people pay this year will be the same rate that they will pay next year. |
| "I hope that from 2017/18 this parliament will have more flexibility in setting income tax rates. However, that will depend on reaching agreement on a new fiscal framework and final passage of the Scotland Bill." | "I hope that from 2017/18 this parliament will have more flexibility in setting income tax rates. However, that will depend on reaching agreement on a new fiscal framework and final passage of the Scotland Bill." |
| Among the other measures proposed by Mr Swinney were: | Among the other measures proposed by Mr Swinney were: |
| Greater controls over income tax are among the measures contained in the Scotland Bill which is currently being scrutinised by Westminster, but these will not come into force until 2017 at the earliest. | Greater controls over income tax are among the measures contained in the Scotland Bill which is currently being scrutinised by Westminster, but these will not come into force until 2017 at the earliest. |
| Mr Swinney said that the Scottish government aimed to set out its longer-term plans on income tax ahead of the dissolution of the Scottish Parliament in March of next year. | Mr Swinney said that the Scottish government aimed to set out its longer-term plans on income tax ahead of the dissolution of the Scottish Parliament in March of next year. |
| He said that the Scottish government's aim was to focus on tackling inequality and boosting productivity in order to "create the foundations for a stronger and more inclusive economy". | He said that the Scottish government's aim was to focus on tackling inequality and boosting productivity in order to "create the foundations for a stronger and more inclusive economy". |
| But he said that would need to be delivered within a "significantly constrained" public spending environment. | But he said that would need to be delivered within a "significantly constrained" public spending environment. |
| Second homes | Second homes |
| Mr Swinney added: "By 2020 our budget will be 12.5% lower in real terms than when the Conservatives came to power. That is the equivalent of one pound in every eight that we spend being cut by Westminster by 2020." | Mr Swinney added: "By 2020 our budget will be 12.5% lower in real terms than when the Conservatives came to power. That is the equivalent of one pound in every eight that we spend being cut by Westminster by 2020." |
| He said that Land and Buildings Transaction tax, which replaced the stamp duty charge on property sales in Scotland, will remain the same for most transactions. | He said that Land and Buildings Transaction tax, which replaced the stamp duty charge on property sales in Scotland, will remain the same for most transactions. |
| But he added: "The exception to this is for buyers purchasing an additional residential property - such as a second home or a buy-to-let - worth more than £40,000, who will face an addition charge of 3% of the value. | But he added: "The exception to this is for buyers purchasing an additional residential property - such as a second home or a buy-to-let - worth more than £40,000, who will face an addition charge of 3% of the value. |
| Mr Swinney said this was "proportionate and fair", adding the new levy "seeks to ensure that the opportunities for first-time buyers to enter the housing market in Scotland remain as strong as they possibly can be". | Mr Swinney said this was "proportionate and fair", adding the new levy "seeks to ensure that the opportunities for first-time buyers to enter the housing market in Scotland remain as strong as they possibly can be". |
| He also announced that he was allocating more than £500m to NHS budgets, which he said would result in total planned spending of nearly £13bn next year - an increase of 6.5% on the comparable figure for 2015/16. | |
| 'Fundamental reform' | |
| But he warned that Scotland's aging population meant that additional funding alone was not enough to equip it properly for the future. | |
| Added: "To really protect our NHS, we need to do more than just give it extra money - we need to use that money to deliver fundamental reform and change the way our NHS delivers care." | |
| To this end, he said an extra £45m would be invested in improvements to primary care, with a further £200m funding six new treatment centres. | |
| Mr Swinney said: "This will equip the NHS to carry out increased numbers of hip and knee replacements and cataract operations, in a way that does not simply add pressure to our emergency hospitals." | |
| The draft budget is normally presented in September, but was delayed this year to take into account the Westminster spending review in November. | The draft budget is normally presented in September, but was delayed this year to take into account the Westminster spending review in November. |
| Scottish Labour's finance spokeswoman Jackie Baillie said: "This is the most important budget since devolution, delivered by a party who promised to stand up for Scotland against Tory austerity. | |
| "But it doesn't deliver fairer taxes, a long term plan for Scotland or an anti-austerity alternative. Local services like our schools, roads and care of the elderly will face massive cuts." | |
| Murdo Fraser of the Scottish Conservatives said Mr Swinney had chosen not to increase the resources available to him by levying additional taxes. | |
| He added: "For years, the finance secretary has portrayed himself as a prisoner of Westminster austerity, but now that he has been given the key to the door of his cell, he has decided not to use it. | |
| "So I trust we will hear no more from the SNP about austerity and Westminster cuts, when the party itself has made the choice not to increase the size of the budget available." |