01 Apr 2019

Scottish military personnel to be protected from tax rises

Scottish military personnel will have protection from proposed tax rises extended for another year.

The Defence Secretary has confirmed that Scottish military personnel will be protected from tax hikes proposed by the Scottish government, increasing the compensation cap from £1,500 to £2,000 to accommodate new rates. The news came after fears that higher tax would mean less military postings in the country.

The renewed scheme will prevent nearly two-thirds of Scottish troops from paying income tax rises for the 2019/2020 financial year. It is hoped the move will improve recruitment and retention rates, adding an incentive for personnel.

Defence Secretary Gavin Williamson said: “Our Armed Forces are deployed where they are most needed and so it is wrong that personnel are penalised or left hundreds of pounds out of pocket because of decisions taken by the Scottish Government.”

“As a result of this decision, I am extending the financial mitigation package for serving personnel in Scotland for another tax year. This demonstrates our commitment to treating all personnel both equally and fairly, wherever they serve.”

The new regulations will be accessible to any personnel paying Scottish income tax, whether they are serving or not. The payments will take into account income tax and national insurance, and will vary from £12 to £2,500.

The MOD will continue to assess tax situations in Scotland and elsewhere on a yearly basis. The country plays a large part in defence, with over 10,000 jobs based in Scotland and numerous defence manufacturing centres.

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