Chris Barber – CFO of ICAS

Chris Barber CA, CFO at ICAS, said: “The Scottish Budget passed at Holyrood today falls short of delivering the meaningful, long-term changes that Scotland’s households and businesses need.

“While raising the starting point for the basic and intermediate income tax thresholds by 7.4% may sound like good news, in practice it gives low earners just £11 of additional income a year. With no reform of the rest of the system, fiscal drag will continue to pull more people into higher tax bands over time, quietly increasing the burden on households without growing the overall tax base.

“Relying on small adjustments and stealth tax rises like this to meet short term pressures isn’t a credible or sustainable route to economic growth. Tax policy should be grounded in clear evidence and long-term analysis, not incremental changes that raise revenue by default rather than by design.”

Mr Barber continued: “We conducted a survey of members in the wake of the Budget announcement which reinforces how fragile confidence in Scotland’s economic direction has become.

“Four in five Chartered Accountants told us they lack confidence in the health of the Scottish economy, and nearly two-thirds (63%) said Scotland needs to prioritise a long-term economic and tax strategy. These findings reflect a growing concern among the highly skilled professionals witnessing the real-world business impact of continued uncertainty.

“With the Scottish elections approaching, the next government must move beyond incremental tax tinkering and set out a coherent economic vision – one that delivers tax stability, supports key growth sectors, and invests in skills to strengthen Scotland’s long-term competitiveness.”