The Scottish government has announced plans to change income tax thresholds as part of its Budget for 2026-27, buy failed to rule out the 2p increase on income tax gained from property that has been announced elsewhere in the UK.
Currently, people in Scotland earning less than about £30,000 pay slightly less income tax than elsewhere in the UK, but people earning more than that face progressively higher taxation.
The point at which people start paying income tax is determined by the UK government.
Above that the Scottish government has three lower rates – starter, basic and intermediate.
Robison said she would raise the threshold of the basic and intermediate rates, meaning people will pay the lower 19% starter rate on more of their earnings.
The threshold for the basic (20%) rate, currently £15,398, will go up by 7.4% to £16,537.
The intermediate rate (21%), which currently starts at £27,492, will rise to £29,527.
However, the higher rate (42%) will continue to kick in at £43,663, and the advanced (45%) and top (48%) rates will also remain unchanged – meaning bigger earners will be dragged into higher bands as their wages increase.
Under the proposals, Scots earning more then £33,500 would pay slightly less income tax than elsewhere in the UK.
Robison said the changes would mean 55% of people would pay less in tax than elsewhere in the UK. However, no reference was made to income tax from property, raising concerns for landlords already operating on tight margins.
Scottish Association of Landlords chief executive, John Blackwood, said: “Scotland’s landlords will be disappointed by this budget, in particular by the Finance Secretary’s refusal to rule out the 2p increase on income tax gained from property that we’ve seen elsewhere in the UK.
“That this tax may come into effect in 2027-28, subject to a legislative consent motion, will cause further uncertainty within Scotland’s private rented sector.
“While we do welcome that there will be no rise in the LBTT additional dwelling supplement, this budget still feels to us like a missed opportunity.
“Rather than continuing on this path, Shona Robison should say unreservedly that increases in tax on property income will not happen and give the sector some much-needed confidence to invest.”