The Scottish Government's reforms to Scottish Income Tax in 2018-19 represented the first major change to the rate and bands of Income Tax in the UK in a number of years. This also marked the first time that the rates of Income Tax in Scotland had notably diverged from those in the rest of the UK (rUK) since the creation of Income Tax in 1799.
In the Medium Term Financial Strategy published on 28 January 2021, the Scottish Government set out a commitment to conduct a more detailed evaluation of the 2018-19 Income Tax policy, including an assessment of the scale of the behavioural effects and the amount of revenue raised.
This has been a unique opportunity to conduct an evaluation of this scale on Income Tax policy and its outcomes will have broader relevance to the approach to taxation in Scotland and beyond.
This publication sets out the analysis and findings from this evaluation. It is being published in tandem with a HMRC study into the responsiveness of taxpayers' income following the 2018-19 reforms.