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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 4 May 2021
  6. Current session: 13 May 2021 to 10 March 2026
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Displaying 4689 contributions

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Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27 (United Kingdom Context)

Meeting date: 16 December 2025

Kenneth Gibson

Good morning, and welcome to the 35th meeting in 2025 of the Finance and Public Administration Committee. We have one public item on our agenda today: an evidence session with the Institute for Fiscal Studies on the United Kingdom context for the Scottish budget 2026-27. I welcome David Phillips, associate director at the Institute for Fiscal Studies.

Mr Phillips, I understand that you have an opening statement to make—is that right?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27 (United Kingdom Context)

Meeting date: 16 December 2025

Kenneth Gibson

One of the issues, which has been well trailed, is the freezing of thresholds. Ultimately, by the end of the current session of Parliament, the tax take will be the highest on record in peacetime, as a share of gross domestic product. Is that correct?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

The Scottish Government has no power over the levy.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

The Laffer curve is not as simple as people think.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I asked three questions at the start, one of which was about LBTT behavioural change. Why do you not look at that? Clearly, one would anticipate behavioural change there. The £137 million of the tax performance gap that was due to other factors is quite a high proportion of the £617 million—it is more than 20 per cent; in fact, it is 22 per cent. What are those other factors? It is a bit opaque.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I mean changes that have already been signalled. If people are to get higher benefits, that reduces the likelihood that they will join the labour market. What impact will that have on fiscal sustainability and taxes?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I am sorry to interrupt, but I think that the point about understanding is really important. The thinking used to be that it was about people fleeing the country, whereas you make it clear in the wee window on page 26 that

“Behavioural responses to tax policy changes ... can include choices such as whether to work more hours, to divert income into pension contributions, take income as dividends instead of salary, or whether to seek employment elsewhere”.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I fully appreciate that, but we are talking about transparency and communication. I think that that point should be part of the transparency and communication in your document. It is not as though we have raised it once or twice. We have raised it umpteen times in this committee and the Scottish Government has more or less conceded the point that, yes, there is not really much point in progressing it. When we read something like that, it is a bit frustrating, to be honest.

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

Thank you.

Let us talk more directly about the Scottish and UK tax systems and the interaction between them. Is the UK tax system progressive, given its obvious anomalies?

Finance and Public Administration Committee [Draft]

Budget Scrutiny 2026-27

Meeting date: 9 December 2025

Kenneth Gibson

I ask because a lot of your report is about behavioural change, but behavioural change does not happen only at the top end; it happens across the pay scale. Your report seems to make no reference to that.

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