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| Scotland 'should set own income tax', says Smith Commission | Scotland 'should set own income tax', says Smith Commission |
| (9 minutes later) | |
| The Scottish Parliament should have the power to set income tax rates and bands, the body on strengthening devolution has concluded. | The Scottish Parliament should have the power to set income tax rates and bands, the body on strengthening devolution has concluded. |
| The Smith Commission also said a share of VAT should be assigned to the parliament, and Air Passenger Duty fully devolved. | The Smith Commission also said a share of VAT should be assigned to the parliament, and Air Passenger Duty fully devolved. |
| The commission was set up by Prime Minister David Cameron in the wake of the vote against Scottish independence. | The commission was set up by Prime Minister David Cameron in the wake of the vote against Scottish independence. |
| Its findings will form the basis of legislation on more Scottish powers. | Its findings will form the basis of legislation on more Scottish powers. |
| The Smith Commission, which took forward its recommendations in consultation with the Scottish Parliament's five parties, recommended that: | The Smith Commission, which took forward its recommendations in consultation with the Scottish Parliament's five parties, recommended that: |
| IN DEPTH: Smith Commission report | |
| Mr Cameron said he was "delighted" with the report, adding: "We are keeping our promise to the Scottish people." | Mr Cameron said he was "delighted" with the report, adding: "We are keeping our promise to the Scottish people." |
| He added that proposals for English MPs to vote on English laws were to be published before Christmas. | |
| Labour opposes the idea of only allowing English MPs to vote on matters that only affect England, claiming they would create two classes of MPs. | |
| Instead, Labour wants more devolution within England. The Lib Dems also favour more regional devolution. | |
| Scotland's Deputy First Minister, John Swinney, said any new powers were to be welcomed, but he added that the commission was a "missed opportunity" to give Scotland full control over welfare. | |
| He said: "Regrettably, the Westminster parties were not prepared to deliver the powerhouse parliament the people of Scotland were promised - under these proposals, less than 30% of our taxes will be set in Scotland and less than 20% of welfare spending will be devolved to Scotland. | He said: "Regrettably, the Westminster parties were not prepared to deliver the powerhouse parliament the people of Scotland were promised - under these proposals, less than 30% of our taxes will be set in Scotland and less than 20% of welfare spending will be devolved to Scotland. |
| "That isn't Home Rule - it's continued Westminster rule." | "That isn't Home Rule - it's continued Westminster rule." |
| Lord Smith, who chaired the commission, said: "Taken together, these new powers will deliver a stronger parliament, a more accountable parliament and a more autonomous Parliament." | Lord Smith, who chaired the commission, said: "Taken together, these new powers will deliver a stronger parliament, a more accountable parliament and a more autonomous Parliament." |
| "The recommendations, agreed between the parties, will result in the biggest transfer of powers to the parliament since its establishment." | "The recommendations, agreed between the parties, will result in the biggest transfer of powers to the parliament since its establishment." |
| Lord Smith's recommendations will form the basis of draft legislation due to be published by January 25, with the main parties at Westminster pledging to take it forward, regardless of who wins the UK election, in May 2015. | Lord Smith's recommendations will form the basis of draft legislation due to be published by January 25, with the main parties at Westminster pledging to take it forward, regardless of who wins the UK election, in May 2015. |
| Analysis | Analysis |
| By Norman Smith, BBC Assistant Political Editor | By Norman Smith, BBC Assistant Political Editor |
| Although publicly today's deal will be welcomed at Westminster - in private there will be a good deal of anguish. | Although publicly today's deal will be welcomed at Westminster - in private there will be a good deal of anguish. |
| For Labour, the package represents a significant retreat - having previously strenuously opposed devolving income tax. | For Labour, the package represents a significant retreat - having previously strenuously opposed devolving income tax. |
| Aware that such a stance was at odds with Scottish opinion, they backed down. | Aware that such a stance was at odds with Scottish opinion, they backed down. |
| The fear now, however, is that it will create renewed momentum for barring Scottish MPs from voting on English laws - a move which could cripple any future Labour govt. | The fear now, however, is that it will create renewed momentum for barring Scottish MPs from voting on English laws - a move which could cripple any future Labour govt. |
| For David Cameron, there will also be anger among some of his MPs that, once again, Scotland appears to have been given more power and allowed to retain the generous Barnett funding formula. | For David Cameron, there will also be anger among some of his MPs that, once again, Scotland appears to have been given more power and allowed to retain the generous Barnett funding formula. |
| And for Unionists, generally there will be unease that today marks merely another staging post on the road to full independence. | And for Unionists, generally there will be unease that today marks merely another staging post on the road to full independence. |