Scotland's 48% top-earner tax cut reduces Treasury income by £22 million

Scotland's left-leaning SNP administration introduced a 48% tax bracket for earnings over £125,140 in the 2024-25 budget, aiming to outpace England on taxing high incomes. Dan Neidle, a former member of the Scottish Tax Advisory Group and head of the think-tank Tax Policy Associates, reported that the move likely trimmed Treasury revenue by about £22 million, with estimates ranging from £15 million to £30 million. The analysis suggests the policy may have breached the Laffer Curve, where excessive rates deter income and encourage avoidance or relocation.

Neidle urged officials to consider the fiscal evidence rather than purely political goals. Conservative finance spokesman Craig Hoy seized on the figures to denounce the SNP's approach as arrogant and harmful to Scotland's appeal for entrepreneurs and skilled workers. A separate study by the Adam Smith Institute noted a broader decline in UK millionaires, attributing part of the trend to high taxes and falling property values.