answer text |
<p>The Government has agreed a block grant adjustment mechanism through the operation
of the Barnett formula with the Scottish Government in relation to the Scottish rate
of income tax.</p><p> </p><p> </p><p> </p><p>During two or three transitional years,
the deduction will reflect the tax generated by a Scottish rate of 10p. Following
this transitional period, the first year deduction will again reflect the tax generated
by a Scottish rate of 10p, and then in subsequent years this deduction will be indexed
against growth in the UK non-savings non-dividend income tax base.</p><p> </p><p>
</p><p> </p><p>The Scottish Government’s overall funding will therefore be partly
determined by the relative growth in the Scottish and UK non-savings non-dividend
income tax base.</p><p> </p><p> </p><p> </p>
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