Scottish income tax outturn reconciliation 2022-23: letter to Finance and Public Administration Committee
Letter from the Cabinet Secretary for Finance and Local Government to update on the joint statement with HM Treasury on the income tax reconciliation for 2022-23. The joint statement sets out the 2022-23 reconciliation which will be applied to the 2025-26 Scottish Budget.
To: Kenneth Gibson MSP, Convener, Finance and Public Administration Committee
From: Shona Robison MSP, Cabinet Secretary for Finance and Local Government
3 October 2024
Dear Kenneth,
I wrote to the Committee on 15 July with regards to HMRC’s publication of 2022-23 outturn for Scottish and UK Income Tax. This publication allowed officials to calculate the reconciliation for 2022-23 income tax which will apply to the 2025-26 Scottish Budget. My letter to the Committee set out that the Scottish Government’s calculation of the reconciliation, which amounted to positive £447 million.
Since then, the Office for National Statistics (ONS) have updated their population estimate for England in 2022-23, which details a slight increase of around six thousand people. As the comparable growth rate between Scotland and the rest of the UK is a component of block grant adjustment (BGA) calculations, this impacts the 2022-23 outturn BGAs and reconciliation.
The outturn BGA has moved from £14,912 to £14,911 million as a result of this population change, which moved the reconciliation from positive £447 million to positive £449 million. This is reflected in the joint statement between SG and HM Treasury, which has now been published. The impact of the population change is outlined in annex a.
My officials will be happy to answer any questions you have on this.
Shona Robison MSP, Cabinet Secretary for Finance and Local Government
Annex a - budget reconciliation, pre-ONS update
Table 1 - 2022-23 reconciliation applying to the 2025-26 Budget, pre-ONS update.
2022-23 Income Tax |
|||
|---|---|---|---|
|
|
Revenues (£m) |
BGA (£m) |
Net Position (£m) |
|
Forecast at Budget 2022 to 2023 |
13,671 |
-13,861 |
-190 |
|
Outturn 2022 to 2023 |
15,169 |
-14,912 |
257 |
|
Change |
1,498 |
-1,051 |
447 |
Annex b - budget reconciliation, post-ONS update
Table 2 - 2022-23 reconciliation applying to the 2025-26 Budget, post-ONS update.
2022-23 Income Tax |
|||
|---|---|---|---|
|
|
Revenues (£m) |
BGA (£m) |
Net Position (£m) |
|
Forecast at Budget 2022-23 |
13,671 |
-13,861 |
-190 |
|
Outturn 2022-23 |
15,169 |
-14,911 |
259 |
|
Change |
1,498 |
-1,050 |
449 |
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