Nicola Sturgeon has been warned Scotland faces a ‘brain drain’ if the SNP refuses to match Conservative tax cuts being implemented in England.
Three former economic advisors to the Scottish Government, along with business leaders have issued a stark picture of the reality the Nationalists would face if they keep taxes higher. It comes after Chancellor Kwasi Kwarteng announced a ‘mini-budget’ on Friday which included scrapping the top rate of tax, cutting income tax for all bands and slashing Stamp Duty.
The SNP has criticised the plans and on Saturday, minister Richard Lochhead indicated there would be no respite for hard-working Scots. But the likes of Sir George Mathewson, the former Royal Bank of Scotland boss, Professor Sir John Kay and the tycoon Jim McColl said high-earners and growth creators will head south if the SNP sticks to its guns.
It comes as deputy chairman of the Centre for Economics and Business Research Douglas McWilliams predicted 20 per cent of top-rate taxpayers would move south. Mr Mathewson, Professor Kay and Mr McColl all served on the Scottish Government’s council of economic advisers.
But they were unimpressed with the SNP’s stance. Professor Kay, a fellow of the British Academy and the Royal Society of Edinburgh, told the Sunday Times: “While the number of people in Scotland paying tax at 46 per cent is just 0.6 per cent of the population, they account for about 16 per cent of Scottish income tax. Very few of those people would have to leave Scotland or shift residence before you would lose more tax than you gain from continuing to charge the higher rate.