Scotland’s higher employment worth billions to Westminster

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  Scotland’s higher employment rate has generated an estimated £280m in additional income tax over the past year, new figures obtained by the SNP have shown.

The latest ONS statistics show that the number of people in employment increased by 67,000 between Jan-Mar 2013 and Jan-Mar 2014.

Research from the Scottish Parliament Information Centre (SPICe) has estimated that this increase in employment is worth around £280m in additional income tax revenue. However, that additional revenue currently goes straight to the UK Treasury.

At the same time the Treasury continues to impose austerity on Scotland meaning Scotland’s public services don’t benefit from the increase in revenues.

The latest figures from the ONS show the number of people in employment increased by 67,000 between Jan-Mar 2013 and Jan-Mar 2014 (seasonally adjusted figures).

While it is not possible to fully capture the effects of increasing employment, calculations from SPICe suggest that an average of around £4,100 is raised in income tax in Scotland is raised per workforce job.

SPICe estimates an additional 67,000 people in employment may result in additional income tax of £279m. The SPICe research adds: “Given the uncertainties in the calculation it would be more advisable to round this figure to the nearest £10 million (around £280 million)”.

The new figures will be a blow to anti-independence campaigners who yesterday tried to claim that a Yes vote would mean an increase in taxes in order to pay for public services.

SNP MSP Kenneth Gibson said:

“These figures are clear evidence that the Scottish Government’s action to boost employment and strengthen the Scottish economy is paying off – in the past year, Scotland has generated an estimated £280m in additional income tax and employment levels are at their highest since records began.

“Although Scotland continues to outperform the UK with lower unemployment, higher employment and lower rates of inactivity, we cannot fully reap the rewards of our efforts – most of the additional revenue raised goes straight to the UK Treasury.

“Only a Yes vote means income tax raised in Scotland will stay in Scotland, with the Scottish Parliament in control of 100 per cent of our tax revenue instead of the 7 per cent we are responsible for now.

“An independent Scotland would be the 14th wealthiest nation in the OECD – ahead of France, Japan and the UK. With full control of our revenue we can invest our wealth and the gains of greater growth in childcare, infrastructure and a fairer future.”