Scottish independence: People would need two more weeks of work to reach 'tax freedom' says Treasury

 

People living in an independent Scotland would have to work for two weeks longer than the rest of the UK to reach the point when their earnings stop going to the taxman and into their pockets, the Treasury has claimed.

According to the free market think tank the Adam Smith Institute, today is "Tax Freedom Day" for the UK – the date on which the average person has paid their share of tax and is now effectively working for themselves.

But the Treasury used the occasion to point out that in an independent Scotland, taxpayers would have to wait until 13 June to reach the same point.

It cited estimates by the Institute for Fiscal Studies (IFS) that in 2016-17 Scotland’s deficit would be £1,000 per head higher than for the UK as a whole, adding that if this hole in the public finances was to be filled through tax increases rather than spending cuts, it would be equivalent to just over two extra weeks of paying tax.

Tomorrow, the Treasury is set to publish a new analysis paper which is expected to claim that everyone in Scotland will be economically better off if the union stays intact.

Danny Alexander, Chief Secretary to the Treasury, said: “As Scotland’s deficit would be £1,000 per head higher than the UK average in 2016-17, taxpayers in an independent Scotland could face working even longer before reaching tax freedom.

“The Treasury will publish the most comprehensive analysis of the fiscal position of Scotland yet produced, which will set out the scale of the UK Dividend for Scotland.”

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