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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 5 May 2021
  6. Current session: 12 May 2021 to 12 July 2025
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Displaying 3539 contributions

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Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Hold on a second, minister. There is no reason why we cannot attract migrants from other parts of the United Kingdom if we have a growing and thriving economy. It is not all about bringing in people from overseas. As I have said before in this committee, there are constituencies in Edinburgh that have 7,000 or 8,000 European Union citizens living and working in them, while my constituency has fewer than 300. That is not because of any difference in migration between Ayrshire and Edinburgh—it is because the economy in Edinburgh is so much stronger. Attracting people from other countries is important, but what about migration of working-age people within the UK? By that, I do not mean folk who retire to Arran, Argyll or Perthshire, but those who come to contribute to the economy.

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Some workers might find it easier to move to Saudi Arabia and pay their taxes there if we do not get the highly paid and highly skilled jobs that we are talking about, but let us move on.

I now open up the session to my colleagues around the table. The first person to ask questions will be John Mason, to be followed by Daniel Johnson.

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Thanks for that.

Moving on, I note that the framework talks about ensuring that Scotland’s public finances are fiscally sustainable. The issue of fiscal sustainability has certainly drawn the committee’s attention, given the Scottish Fiscal Commission’s forecast that by 2024-25—which will come round a lot sooner than we might think—social security spending will have increased beyond the block grant adjustment by £764 million, and that is even before the Scottish Government has delivered a 6 per cent uplift in benefits. How will the framework try to ensure fiscal sustainability?

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Good morning and welcome to the 11th meeting in 2022 of the Finance and Public Administration Committee.

Agenda item 1 is an evidence-taking session on the Scottish Government's “Framework for Tax 2021”. We are joined by Tom Arthur, Minister for Public Finance, Planning and Community Wealth, who is accompanied by Alex Doig, deputy director for tax, Scottish Government. I welcome you both and invite Mr Arthur to make a short opening statement.

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Minister, you talked about how tax rich oil workers are as a proportion of the Scottish economy. You also talked about the need for a green transition. What evidence do we have that people are transitioning from the oil and gas industry into green jobs at the same salary levels as they enjoy from working in the North Sea? In terms of taxation, that is critical.

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

I would appreciate that.

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Thank you very much for that very interesting statement. I believe that a lot of questions will emerge from it.

You mentioned two new principles, the first of which was engagement to promote public understanding. In that respect, you talked about the importance of communicating clearly and engaging the public. What form is that engagement and communication taking?

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

Prior to the devolution of income tax and in the run-up to 2017, there was a lot of discussion about how Scotland would address tax avoidance differently from the United Kingdom Parliament. How has that evolved over the years? I note that one of the new principles is “to minimise tax avoidance”. What has been the Scottish Government’s method—if you want to put it that way—of minimising tax avoidance, and how does it differ from that of the UK?

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

My understanding was that the Scottish Government was going to take a principled approach to tax avoidance in contrast to the UK’s position, under which, unless something is specifically addressed in legislation, there is an opportunity for avoidance. In Scotland, these things were not to be set in tablets of stone; the idea was that, if the authorities even perceived that the intention was to avoid tax, they would still be able to collect it. I believe that John Mason was on the committee that deliberated on the matter. Are we not moving forward with that? Was minimising tax avoidance not going to be a significant difference between Scotland and the UK?

Finance and Public Administration Committee

Framework for Tax

Meeting date: 22 March 2022

Kenneth Gibson

I have to say that the choice of taxes does not fulfil Adam Smith’s four criteria of certainty, proportionality to taxpayers’ ability to pay, convenience and efficiency. I think that aspects of the chosen taxes—especially VAT—are extremely contentious when it comes to who gets what and whether Scotland benefits disproportionately from an assignment. However, that is undoubtedly a discussion for another day.