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New Scots powers 'not ruled out', says Alex Salmond | |
(about 4 hours later) | |
Chancellor George Osborne has not ruled out new financial powers for Holyrood demanded by the SNP government, First Minister Alex Salmond has said. | |
Mr Salmond has asked for control in areas including corporation tax and alcohol excise duties, following his party's landslide election win. | |
The first minister said a two-hour meeting with the chancellor was "constructive and positive". | |
But Mr Orborne has ruled out a re-think of his North Sea oil tax hike. | |
Mr Salmond said the UK Budget measure, which will see an extra £2bn tax on oil and gas production, could cost 10,000 potential jobs. | |
The chancellor is willing to consider widening proposals to help sustain investment in the sector, in the form of broader field allowances. | |
The meeting was scheduled for just half an hour. In the end the two ministers met for close to two hours. | |
Alex Salmond says that should be read as a recognition from the chancellor of the first minister's new mandate from the Scottish people in the elections. | |
Top of the first minister's list today was the tax hike on North Sea oil producers, which he believes is damaging investment in the sector. | |
Although George Osborne won't scrap the increase, he's told Mr Salmond that he'll consider more help for producers in the sector in the form of broader field allowances. | |
But the first minister had much more to demand - further borrowing powers, control of corporation tax, alcohol excise duties and money from the fossil fuel levy. | |
He says the chancellor ruled nothing out - but that also means he's ruled nothing in. | |
And although Mr Osborne and the UK government might be listening, handing over all of those powers is another thing. | |
Elsewhere, Mr Salmond wants devolution of further borrowing powers, control of corporation tax, alcohol excise duties and money from the fossil fuel levy. | |
That would go further than the new Holyrood powers proposed in the Scotland Bill, currently going through Westminster, and the UK government has said the SNP must make a proper case for increased responsibility. | |
In his Budget, Mr Osborne raised supplementary tax on oil and gas production from 20% to 32%, to fund a cut in fuel duty. | |
Oil and Gas UK, the trade association representing the offshore sector, has said the tax rise would cost the industry as much as £50bn over the next 10 years. | Oil and Gas UK, the trade association representing the offshore sector, has said the tax rise would cost the industry as much as £50bn over the next 10 years. |
Mr Salmond told Radio Four's Today programme: "The problem with the smash and grab raid, the extra £2bn on top of the other £11bn the chancellor was expecting from Scottish oil revenues this year, is that it is going to cost a lot of jobs. | |
"It will actually make future chancellors worse off in the long-term because it will lead to a substantial reduction in what investment would have been." | "It will actually make future chancellors worse off in the long-term because it will lead to a substantial reduction in what investment would have been." |
The Treasury has said it expected offshore company profits to remain high, but, if it identified some potential impact on investment, would consider using allowances to deal with it. | |
Mr Osborne's department also said it was continuing to liaise with the industry on setting the level of its fair fuel stabiliser, where taxes would fall to reflect a cut in the oil price. | |