Scotland's Fiscal Devolution Story
An account of how Scotland's fiscal landscape has transformed over the past 3 decades, with an overview what fiscal devolution has enabled, how the system now operates and the medium-term challenges ahead.
Footnotes
1 The ability to vary the basic rate of Income Tax by up to 3 pence in the pound has been described as “largely symbolic” McIntyre, S., Mitchell, J., & Roy, G. (2022b).
2 The ‘no detriment’ principle was to ensure that neither the Scottish nor the UK Government’s overall financial position should be negatively impacted as a result of the devolution of tax and welfare powers.
3 Audit Scotland: About the Auditor General.
4 Scottish Government: Government Finance – Financial Reports and Accounts.
5 The Accountant Online: Scotland’s public sector implements IFRS. (Nov-11).
6 Scottish Government: National Performance Framework.
7 The Scottish Government and COSLA: Concordat between the Scottish Government and COSLA.
8 Dr Campbell Christie CBE: Christie Commission on the future delivery of public services. (29‑Jun‑11).
9 The Calman Commission Serving Scotland Better: Scotland and the United Kingdom in the 21st Century (15-Jun-09)
10 The Smith Commission Report of the Smith Commission for further devolution of powers to the Scottish Parliament (27-Nov-14)
11 McIntyre, S., Mitchell, J., & Roy, G. (2022b). Fiscal devolution and the accountability gap: budget scrutiny following tax devolution to Scotland. Regional Studies, 57(7), 1380–1391.
12 McIntrye, S., Mitchell, J. and Roy, G. (2022a). ‘Careful What you Wish for? Risk and Reward with Scottish Tax Devolution’, in The Political Quarterly, Vol. 93, No. 3.
13 HM Government and the Scottish Government: The agreement between the Scottish Government and United Kingdom Government on the Scottish Government's fiscal framework. (Feb‑16).
14 Bell, D., Eiser, D., & Phillips, D.: Fiscal Framework Review: Independent Report. (02‑Aug‑23).
15 HM Government and the Scottish Government: Fiscal framework: agreement between the Scottish and UK Governments. (Feb‑16).
16 McIntrye, S., Mitchell, J. and Roy, G. (2022a). ‘Careful What you Wish for? Risk and Reward with Scottish Tax Devolution’, in The Political Quarterly, Vol. 93, No. 3.
17 Scottish Government: Scottish Budget: 2024 to 2025. Page 15 (19‑Dec‑23).
18 HM Treasury: Statement of Funding Policy: Funding the Scottish Government, Welsh Government and Northern Irish Executive (Jun‑25).
19 Budget Process Review Group: Final Report. (30‑Jun‑17).
20 SPICe: The Scottish Government’s financial strategy – navigating uncertain fiscal waters. (22‑May‑25).
21 Finance and Public Administration Committee Report on the Scottish Budget process in practice- (June 2025)
22 OECD: OECD Review of the Scottish Fiscal Commission 2019. (24‑Oct‑19).
23 OECD: OECD Review of the Scottish Fiscal Commission 2025. (10‑Mar‑25).
24 Finance and Public Administration Committee: Official Report – 18 March 2025.
25 The Scotsman: John Swinney scraps stamp duty in Scotland for ‘fairer tax’. (08‑Jun‑12).
26 Revenue Scotland: A summary of Revenue Scotland's first year in operation and A summary of the 2016-17 operating year
27 Revenue Scotland: Delivery in 2018–19: Scotland's devolved tax authority.
28 Revenue Scotland: About Us.
29 Scottish Government: Taxes: Aggregates Levy.
30 Scottish Government: Taxes: Air Departure Tax.
31 Scottish Government: Taxes: Scottish Buildings Safety Levy.
32 SPICe: Social Security Budget 2025–26. (17 Dec 2024).
33 SPICe: Social Security Budget 2025–26. (17 Dec 2024).
34 Scottish Commission on Social Security: Independence and Accountability.
35 Social Security Scotland: Our Charter. (N/A).
36 Scottish Government: Scotland's fiscal outlook: medium‑term financial strategy. (25‑Jun‑25)
37 Scottish Government: The Scottish Government's Fiscal Sustainability Delivery Plan 2025. (25‑Jun‑25).
38 Scottish Government: Open Government action plan 2021 to 2025. (26‑Nov‑25).
39 HM Revenue and Customs: Service Level Agreement for operation of Scottish Income Tax by HMRC. (17‑Jul‑25).
40 Revenue Scotland: Financial Statement 2020–21.
41 Social Security Scotland: Annual Report and Accounts 2021.
42 Scottish Government: Scottish Government capital borrowing and bonds: memorandum. (19‑Dec‑23)
43 McIntrye, S., Mitchell, J. and Roy, G. (2022a); and Finance and Public Administration Committee Report on the Scottish Budget process in practice - (June 2025)
44 Finance and Public Administration Committee Report on the Scottish Budget process in practice- (June 2025)
45 Office for Budget Responsibility Fiscal Risks and Sustainability Report (July 2025)
46 Finance and Public Administration Committee Report on the Scottish Budget process in practice- (June 2025)
47 Finance and Public Administration Committee Report on the Scottish Budget process in practice- (June 2025)
48 Scottish Government: Scottish Spending Review 2026. (13‑Jan‑26)
49 McIntrye, S., Mitchell, J. and Roy, G. (2022a).
50 McIntrye, S., Mitchell, J. and Roy, G. (2022a).
51 Cabinet Secretary for Finance and Local Government Letter from the Cabinet Secretary for Finance and Local Government to the Convener of 25 November 2025 (25-Nov-25)
52 Scottish Government: Scotland's Tax Strategy: Building on our Tax Principles.
53 Scottish Government: Taxes: Cruise Ship Levy.
54 Scottish Government: Taxes: VAT policy
55 Scottish Government: Stepping up action to net zero. (18‑Apr‑24)