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Average worker in Scotland will be £833 better off a year as government cuts taxes
Over 2.4 million workers in Scotland will benefit as National Insurance cuts hit pay packets this month
27 million employees to benefit across the country from tax cuts that reward work and grow the economy
The typical worker in Scotland will be £833 better off thanks to successive cuts to employee National Insurance contributions (NICs), which hit pay packets this month.
27 million workers across the UK will see a boost to their take-home pay from 6 April, with over 2.4 million people to benefit in Scotland alone.
The savings are a result of successive cuts to NICs announced by the Chancellor, slashing the main rate of employee NICs from 12% to 8% and the main rate of self-employed NICs from 9% to 6%.
These cuts are possible because the economy is turning a corner, thanks to the government’s decisive action to bring inflation down from 11.1% to 3.4%. The government is sticking to its economic plan and in the longer-term, it has the ambition to cut NICs further, ending the unfair double tax on work.
Chancellor of the Exchequer Jeremy Hunt said:“The tax cuts coming into force this week show that our economic plan is working, putting £833 a year back into the pockets of working people across Scotland.
“People will start to see this saving in their pay packet this month and, when it’s responsible to do so, we will go further – ending the unfair double tax on those who earn their income through work.”
Secretary of State for Scotland Alister Jack said: “It’s fantastic that this second 2p cut to National Insurance, on top of the first 2p cut in January, is putting more money in the pockets of hard-working Scots from today. Around 2.4 million Scottish workers will be £833 per year better off, on average.
“It’s all part of our plan to increase prosperity and grow the economy. And with inflation expected to fall to target next quarter, our measures are working.”
Taking the NICs reforms across Autumn Statement and Spring Budget together, this is an overall tax cut worth over £20 billion per year, the largest ever cut to employee and self-employed National Insurance.
Due to the combined cuts to employee and self-employed NICs, the OBR forecast that total hours worked will increase by the equivalent of almost 200,000 full-time workers by 2028-29 and help grow the economy.
These changes mean that for single individuals on average salaries, personal taxes would have been lower in the UK than in France, Germany and every other G7 economy, based on the most recent OECD data.
New funding alongside actions to increase productivity
First Minister Humza Yousaf has announced an initial £30 million of targeted investment for Q1 of the new financial year, as part of a £300 million plan over the next three years, to help reduce inpatient and day-case waiting lists.
Backed by planned additional investment, this targeted approach will help drive down waiting lists by an estimated 100,000 patients over three years.
Visiting the National Treatment Centre in Fife, one year on since its official opening, First Minister Humza Yousaf said: “As I set out last October, we are committed to accelerating treatment in our NHS and reducing inpatient and day-case waiting lists by an estimated 100,000 patients over the next three years, backed by planned investment of an extra £100 million annually.
“This initial investment of £30 million will target reductions to national backlogs that built up through the pandemic, including orthopaedic treatment, diagnostics for cancer referrals and patients with the longest waits.
“This is all part of our programme to drive up productivity and tackle waiting lists, supported by the Centre for Sustainable Delivery.
“Together, our actions will further enable NHS Scotland to maximise capacity, build greater resilience and deliver year-on-year reductions in the number of patients who have waited too long for treatment.”