Budget - Provisional Outturn 2022-2023: briefing note
The 2022-2023 Provisional Outturn briefing note provides further supporting information to the Provisional Outturn statement 2022-2023 delivered by the Minister for Community Wealth and Public Finance on 15 June 2023.
Scottish Income Tax
4. The Scottish Parliament set the following rates and bands of Scottish Income Tax for 2022-23:
| Bands | Band Name | Rate |
|---|---|---|
| £12,571 - £14,732 | Starter Rate | 19% |
| £14,733 - £25,688 | Basic Rate | 20% |
| £25,689 - £43,662 | Intermediate Rate | 21% |
| £43,663 - £150,000 | Higher Rate | 41% |
| Over £150,000 | Top Rate | 46% |
5. As noted in the 2023 Medium Term Financial Strategy[1], although tax performance remains a key risk to the resource funding position, recent evidence across a range of indicators suggests that Income Tax performance is improving.
6. Provisional in-year Pay As you Earn (PAYE) tax data for the first 11 months of 2022-23 suggest that growth in Scottish PAYE income tax receipts has outperformed the rest of the UK.
7. The strong Real Time Information (RTI) tax data is reflected in the latest Scottish Fiscal Commission (SFC) forecasts from May 2023, with income tax receipts expected to grow strongly by 10% to £14,764 million in 2022-23.
8. According to the latest SFC/Office for Budget Responsibility (OBR) forecasts, the net position in 2022-23 is expected to be negative at -£102 million, compared to -£190 million when the Budget was set. However, this forecast improvement has no impact on our spending power in 2022-23 as figures for Income Tax are "locked in" until outturn becomes available and the final reconciliations are calculated.
9. On current forecasts, a positive £88 million reconciliation is expected to be applied to the 2025-26 Budget.
Contact
Email: fiscalmanagement@gov.scot
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