Scotland Act 2016 implementation: seventh annual report

Report to inform parliament of the implementation work that has been carried out on fiscal powers devolved in the Scotland Act 2016.

2. Fully Devolved Taxes

The Scotland Act 2016 provided for the devolution of powers to introduce a tax charged on the carriage of passengers by air from airports in Scotland and on the commercial exploitation of aggregates in Scotland. Devolved taxes drawing on these powers have not yet been introduced.

Table 2.1: Implementation and Administrative Costs
£m 2020-21 2021-22 2022-23
Implementation - - 0.1
Administration/Operation - - -

10. Consistent with the approach taken for previous reports, the figures in Table 2.1 above relate only to Revenue Scotland. For this report, the 22-23 figure relates solely to staff costs incurred in work to prepare for the future introduction of a devolved replacement for the UK Aggregates Levy.

Aggregates Levy

The Scotland Act 2016 provided the Scottish Parliament with the power to legislate for a tax to replace the Aggregates Levy in Scotland. Aggregates Levy is a tax paid on the commercial exploitation of primary aggregates, i.e. crushed rock, sand and gravel.

11. The Scottish Government committed to introduce a Scottish Aggregates Levy Bill in the 2022-2023 Programme for Government, published in September 2022.

12. The Bill will draw on the powers in the Scotland Act 2016 by setting out the key arrangements for a devolved tax on the commercial exploitation of aggregates in Scotland, including to provide for its administration by Revenue Scotland

13. A public consultation to inform the development of the Bill ran from September to December 2022. A stakeholder advisory group was subsequently convened from March 2023.

14. The British Geological Society was commissioned in December 2021 to undertake a survey of aggregate minerals in Scotland, which will provide up-to date information on the quantities, reserves, sales and movement of aggregate minerals in Scotland. Work related to the survey has progressed throughout 2022-23. The Scottish Government will publish a report this year.

Air Departure Tax

15. The introduction of Air Departure Tax (ADT) in Scotland remains deferred to allow the issues raised in relation to the exemption for flights departing from the Highlands and Islands to be resolved. The UK Government will maintain application of Air Passenger Duty in Scotland in the interim.

16. The Scottish Government remains committed to the introduction of ADT and to finding a solution that remains consistent with our climate ambitions.



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