UK ministers say the new Holyrood powers will make the parliament more accountable for the cash it spends Plans to give Scotland new powers to control a third of its budget are due to be unveiled, under new legislation.
The UK government’s Scotland Bill will allow Holyrood to raise half its income tax and devolve powers in several other areas.
Scottish Secretary Michael Moore said the bill would mark the biggest transfer of fiscal power to Scotland since the creation of the UK.
But Scotland’s SNP government said full fiscal autonomy was needed.
The Scotland Bill, to be launched in Edinburgh, follows the findings of the Calman Commission review of devolution.
Under the recommendations, the UK Treasury would deduct 10p from standard and upper rates of income tax in Scotland and give MSPs the power to decide how to raise cash.
The new powers would be combined with a cut in the block grant, currently about £30bn, which Scotland gets from the UK government.
Scotland already has the ability to vary income tax by 3p in the pound, although the so-called tartan tax has never been used.
Stamp duty and landfill tax are also likely to be devolved, but it emerged at the weekend that plans to hand over powers on the aggregates levy and aviation tax have been put on hold.
Mr Moore said the first tax was currently subject to a dispute in the European courts, while the latter was under review by the UK government.
The Scottish secretary said the handover of new powers – set to happen in 2015 – would address concerns that the Scottish Parliament is not accountable enough for the cash it spends.
“The transfer of these powers will allow Scottish ministers to make decisions which are responsive to Scotland’s needs,” he said.
“That is exactly the relationship devolution was designed to deliver between the two parliaments and will see more flexibility for Scotland’s police forces to create national strategies to keep Scots safe when it comes to air weapons, drink-driving and speed limits.”
“The Tories, aided and abetted by Labour and the Lib Dems, are about to introduce legislation which will result in Scotland being worse off”
Linda Fabiani SNP MSP
But the Scottish government argued the new financial powers would actually cost Scotland more money.
The announcement of the bill comes after the SNP published a list of 18 Scottish businessmen and economists who criticised the “limited” Calman recommendations, including Jim McColl, of Clyde Blowers, hotelier Stewart Spence and former Scottish Enterprise chief Crawford Beveridge.
SNP MSP Linda Fabiani, who sits on the Scottish Parliament’s finance committee, said: “These Tory tax changes fall far short of what Scotland needs and would have slashed £900m from Scotland’s budget over the last three years.
“Before the Scotland Bill has been published, the Tory government has admitted it is withholding £150m of taxes that should be devolved to Scotland – on top of the £1.3bn they are cutting from Scottish spending next year.
“The Tories, aided and abetted by Labour and the Lib Dems, are about to introduce legislation which will result in Scotland being worse off.”
The Scotland Bill is also likely to allow the Scottish Parliament to take control of national speed limits, drink-driving laws and airguns legislation.
The UK government has chosen St Andrew’s Day to launch the bill – the planned date for the Scottish government’s independence referendum, which was dropped because of a lack of parliamentary support.
Labour, the Tories and the Lib Dems said parties which rejected independence won 80% of the vote in the 2007 Scottish election.
The three opposition groups said they now expected SNP ministers to make time for an early debate on the bill at Holyrood.
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