Today the Scottish Government has published its draft Budget for 2025-2026, which it says is ‘filled with hope for Scotland’s future’ alongside its new Tax Strategy.
Oxfam Scotland welcomes the additional investment in public services, including the NHS and social care, as well as affordable housing and some areas of climate action. Campaigners have also praised the Scottish Government’s pledge to provide financial relief to some low-income families by mitigating the effect of the two-child benefits cap imposed by the UK Government, though not until 2026. However, the Scottish Child Payment is only rising in line with inflation.
Campaigners say the First Minister’s key priorities – including eradicating child poverty, tackling the climate crisis, and improving public services – will continue to be badly short-changed in the medium and long-term.
Oxfam Scotland says that alongside a fairer economy and maximising the impact of existing public spending, action is needed – far beyond small-scale tweaks to Income Tax thresholds – so that Scotland’s devolved and local tax systems make a bigger and better contribution towards delivering key national priorities.
Campaigners have slammed the Scottish Government’s continued failure to implement a tax on pollution spewing private jets, which they say gives the wealthiest polluters a free pass while Scotland is starved of potential extra funding for green initiatives. They highlight the cut to next year’s Budget to promote active and sustainable travel. Oxfam Scotland is calling for Ministers to turbocharge talks with the UK Government in order to give the new tax clearance for take-off as soon as possible.
With the previous Council Tax freeze is lifted, Oxfam Scotland has criticised the Scottish Government’s silence on wider reform, branding the perpetual paralysis on replacing the unfair, outdated tax as ‘indefensible’.
Campaigners say the Scottish Government’s new Tax Strategy must now catalyse the meaningful, long-term tax reform required to drive much faster progress on the First Minister’s priorities, not sustain the damaging status quo.
As part of Tax Justice Scotland, more than 50 organisations are urging Scotland’s political leaders to work together to reform devolved and local taxes to enable more public spending, tackle inequality and reward businesses that do the right thing like delivering decent work and pay, supporting carers, and working to reduce their carbon emissions. They say action in Scotland must be matched by reforms at UK level, including to better tax wealth.
Jamie Livingstone, Head of Oxfam Scotland, said: “This budget undoubtedly delivers some much-needed progress, like ending the two-child limit, but ultimately the First Minister’s promises to eradicate child poverty and tackle climate change will remain built on sand without further new public spending funded by bold, long-term fair tax reform. The real test of the new Tax Strategy is whether it delivers a tax system that delivers fairness, not one that props up a financial house of cards.”
/ENDS
For more information and interviews, please contact: Rebecca Lozza, Oxfam Media and Communications Adviser, Scotland and Wales: rlozza1@oxfam.org.uk / 07917738450