Are Devolved Regional Taxation Powers Possible In The Post-Referendum UK?
Following weeks of tumult, debate and finally the climatic vote, Scotland spoke and opted to remain part of the Union. Nearly 3.7million people voted, with the ‘No’ camp winning out in the end with over 55% of the votes cast.
A key part of the Scottish referendum battleground was the economy, and with the dust settling on last week’s decision, the possibility of increased devolved tax powers in the wider UK is a subject under much discussion.
Richard Perch, Senior Business Development Manager at Umbrella.co.uk gave us his views on this new chapter of economic debate in Britain: “The examination of recent events and the inevitable scrutinisation of tenets of how the UK is governed has extended the debate over economic sovereignty.”
“At local government level and in the wider business world there are voices encouraging higher levels of devolved taxation throughout the UK. Commentators point to the Westminster deal offering the Scottish Parliament greater control of their finances as the prompt point for these views.”
“The Institute of Directors recently carried out a survey and found that two-thirds of the UK’s Managing Directors would be in favour of greater regional devolution of tax powers.”
“In parts of Westminster, there is concern that a Pandora’s Box may have been opened in guaranteeing a ‘No’ vote Edinburgh the chance to assess city workers income fee levels separately from the rest of the UK. The feeling is that this creation of a multi-layered tax system could destabilise the wider country.”
“Simply put, the existence of two tax systems could well pit parts of the country against each other in attracting investment, creating jobs and retaining talent: there is clearly some concern as well at the long-term impact on social mobility that having two different tax systems could create.”
“However, we are really at early days here. So soon after the referendum, it has hard to gaze into crystal ball and speculate that working in Leeds, say, may be more beneficial in income tax terms than working in Bristol! That level of devolved taxation – which in a sense is regional, or cityscaped in nature – is not realistic at this point.”
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