PwC Scotland comments on the UK Government Spring Budget

“Today’s Budget may not be seen as ‘headline grabbing’ in the traditional sense, given how well-trailed most of the measures were.

“There was concern across Scottish business that the rumoured headline income tax cut would become a reality, further increasing the north / south differential as result of both fiscal drag and the recent announcements on the thresholds and higher rates for the Scottish Rate of Income Tax. As it was, the two percentage point decrease in National Insurance Contributions will be welcomed by Scottish businesses and taxpayers.

“Changes announced to abolish the long-lived non-dom regime could be of significant impact to inbound temporary residents in Scotland, particularly those concentrated in the North East.

“What may disappoint those within the energy sector - and even some in the political world - is the confirmed extension of the oil and gas Energy Profits Levy (EPL) to 31 March 2029 - while the reference to abolishing windfall tax ‘when market prices allow’ does not provide firms operating in a key sector for the Scottish economy with any certainty going forward. 

“The extension of Investment Zones from five to ten years, and the inclusion of Arbroath in the expanded Long Term Plan for Towns, will both be positively received; but what may disappoint those in our growing life sciences sector is the concentration of funding for traditional ‘golden triangle’ locations such as Cambridge leaving cities in the central belt with further challenges to attract fast-growth businesses and key skilled workers.”