Businesses in Scotland are grappling with the challenges posed by the highest tax rates in the UK, as highlighted in the Fraser of Allander Institute's latest report. The survey of 300 firms revealed that nearly two-thirds have been affected by the Scottish Government's income tax policy, with 17% reporting a ‘significant' impact on operations. Professor Mairi Spowage stated: “These results shed light into the ongoing debate on how tax policies are affecting businesses and the broader Scottish economy.” Many firms are struggling to attract and retain talent, leading to increased wage demands and a perception of competitive disadvantage compared to the rest of the UK. The report also noted that the income tax gap has widened, with individuals earning £40,000 paying £111 more in Scotland than elsewhere.
