Budget - provisional outturn 2023 to 2024: briefing note - 20 June 2024

The 2023 to 2024 provisional HM Treasury fiscal outturn is £49.3 billion against a fiscal budget of £49.6 billion. The remaining funding of £292 million (0.6% of the total budget) has been carried forward within the Scotland Reserve if confirmed at Final Outturn with no loss of spending power.

Scottish Income Tax

5. The Scottish Parliament set the following rates and bands of Scottish Income Tax for 2023-24:

Table 2: Scottish Income Tax Rates
Band Income Range Rate
Starter Rate £12,571 - £14,732 19%
Basic Rate £14,733 - £25,688 20%
Intermediate Rate £25,689 - £43,662 21%
Higher Rate £43,663 - £125,140 42%
Top Rate Over £125,140 47%

6. 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 has been strong in 2023-24.

7. Provisional in-year Pay As you Earn (PAYE) tax data for the first 11 months of 2023-24 suggest that growth in Scottish PAYE income tax receipts has outperformed the rest of the UK.

8. The strong Real Time Information (RTI) tax data is partially reflected in the latest SFC forecasts from December 2023, with income tax receipts expected to grow strongly by 13% to £17,357 million in 2023-24.

9. According to the latest SFC/OBR forecasts, the net position in 2023-24 is expected to have improved significantly at +£827 million, compared to +£325 million when the budget was set. However, this forecast improvement has no impact on our spending power in 2023-24 as final figures for Income Tax are “locked in” until outturn becomes available. Should final outturn figures turn out to be higher or lower than originally forecast, the impact will be deferred to the 2026-27 Budget via the reconciliation process.

10. On current forecasts, a positive £502 million reconciliation is expected to be applied to the 2026-27 Budget.


Email: fiscalmanagement@gov.scot

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