THOUSANDS more taxpayers moved to Scotland than left each year in the period after income tax rates were put up north of the Border, new research has found.
A study by HMRC for the Scottish Government found a steady increase in net migration of taxpayers in the five years since Scottish Income Tax was introduced in 2017-18.
On average during that period, almost 4200 more taxpayers moved to Scotland than left each year, the study found.
In 2021-22 – the latest year of available data – £200 million in extra taxable income was brought into Scotland, with more higher and top rate taxpayers moving to Scotland than leaving.
Provisional findings were shared with ministers ahead of setting the 2024-25 Scottish Budget, which saw the creation of a new advanced rate of 45% for those earning between £75,000 and £125,140.
It comes despite warnings wealthier Scots may leave the country to escape higher rates of income tax.
Finance Secretary Shona Robison (below) welcomed the findings of the study, saying it was “yet more proof that Scotland is an attractive place for people to live and work”.
She added: “We know people base the decision on where to live on a range of factors, and by coming to Scotland they have access to a range of services and benefits not available elsewhere in the UK, including free tuition and prescriptions.
“Scotland has the most generous childcare package for three and four year olds, and council tax is lower here than in England.
“This social contract with the people of Scotland is funded in part by our progressive income tax system.
“Indeed, in 2021-22 some £200m in taxable income was brought here as a result of inward migration in a single year, increasing economic activity while helping fund vital public services like our NHS and our efforts to tackle child poverty.”
So we are using net migration figures to measure how good a country is doing are we?
Do England next
Pour some cope out for the shrill brigade
Tbh, if I stayed south of the border, I’d move up here, pay the extra 1p in tax & my kids can have free university tuition.
And we’re generally a funnier, warmer bunch up here😎
I ola
But immigration to the UK overall is much larger in this period. So much spin going on in this article.
So the last data they’re basing this success off was from 21-22, when they really only started ramping the tax up in 23-24 and onwards? Good one.
Immigration has shot up in the UK post-Brexit (800,000 in 2016, now forecast to be 1.2 million for 2023), so would expect Scottish tax base to be increasing. However, data shows that top-rate payers don’t seem to have been deterred, so a relative success for this policy.
That’s not quite what HMRC said, but okay.
Just the pearl clutches annoyed then.
Interesting, is it high or medium earners though, most only pay a little more tax, but curious if the impact is the same for those people that will pay a fair bit more
Only thousands? Wasn’t net migration to the UK as a whole over 1 million last year? I feel like when you take that into account, Scotland actually lost out
Is there any data which breaks down the homeowner status of these ENG>>>SCO migrants?
Anecdotally I know – and know of – a fair few who have moved north due to lower house prices. For those with WFH gigs Scotland can allow FTB’ers in particular an opportunity to get on the property ladder. The extra income taxes are brushed aside via salary sacrifice.
I’ve always said that people will move to Scotland if you give them an economic reason. Jobs and housing are always the primary drivers and WFH has enabled many to take advantage of Scotland’s lower house prices. It’s an interesting demographic shift. If it continues then the consequences might be interesting – socially, economically, politically.
> Indeed, in 2021-22 some £200m in taxable income was brought here as a result of inward migration in a single year, increasing economic activity while helping fund vital public services like our NHS and our efforts to tackle child poverty
Yes, and HMRC’s conclusion was that would have been something like £260m had it not been for higher rate taxpayers being put off moving here or choosing to leave.
It’s not the absolute numbers that matters for deciding whether this was a good idea, it’s whether another policy would have been better.
It’s almost as if there are reasons to live in Scotland that don’t just involve money…
Functioning public services are attractive. Ok, maybe not functioning, but slightly less shit at least. The situation is dire across the UK, but at least Scotland is trying to top up spending.
Just for interest. I earn about the UK average of £35k. Per month I am *£3* a month worse off by living here rather than anywhere else. This is before you look at other variables such as house prices (£95k higher) or water bills (10% higher)
Suddenly a few quid a month is looking very cheap.
17 comments
THOUSANDS more taxpayers moved to Scotland than left each year in the period after income tax rates were put up north of the Border, new research has found.
A study by HMRC for the Scottish Government found a steady increase in net migration of taxpayers in the five years since Scottish Income Tax was introduced in 2017-18.
On average during that period, almost 4200 more taxpayers moved to Scotland than left each year, the study found.
In 2021-22 – the latest year of available data – £200 million in extra taxable income was brought into Scotland, with more higher and top rate taxpayers moving to Scotland than leaving.
Provisional findings were shared with ministers ahead of setting the 2024-25 Scottish Budget, which saw the creation of a new advanced rate of 45% for those earning between £75,000 and £125,140.
It comes despite warnings wealthier Scots may leave the country to escape higher rates of income tax.
Finance Secretary Shona Robison (below) welcomed the findings of the study, saying it was “yet more proof that Scotland is an attractive place for people to live and work”.
She added: “We know people base the decision on where to live on a range of factors, and by coming to Scotland they have access to a range of services and benefits not available elsewhere in the UK, including free tuition and prescriptions.
“Scotland has the most generous childcare package for three and four year olds, and council tax is lower here than in England.
“This social contract with the people of Scotland is funded in part by our progressive income tax system.
“Indeed, in 2021-22 some £200m in taxable income was brought here as a result of inward migration in a single year, increasing economic activity while helping fund vital public services like our NHS and our efforts to tackle child poverty.”
So we are using net migration figures to measure how good a country is doing are we?
Do England next
Pour some cope out for the shrill brigade
Tbh, if I stayed south of the border, I’d move up here, pay the extra 1p in tax & my kids can have free university tuition.
And we’re generally a funnier, warmer bunch up here😎
I ola
But immigration to the UK overall is much larger in this period. So much spin going on in this article.
So the last data they’re basing this success off was from 21-22, when they really only started ramping the tax up in 23-24 and onwards? Good one.
Immigration has shot up in the UK post-Brexit (800,000 in 2016, now forecast to be 1.2 million for 2023), so would expect Scottish tax base to be increasing. However, data shows that top-rate payers don’t seem to have been deterred, so a relative success for this policy.
That’s not quite what HMRC said, but okay.
Just the pearl clutches annoyed then.
Interesting, is it high or medium earners though, most only pay a little more tax, but curious if the impact is the same for those people that will pay a fair bit more
Only thousands? Wasn’t net migration to the UK as a whole over 1 million last year? I feel like when you take that into account, Scotland actually lost out
Is there any data which breaks down the homeowner status of these ENG>>>SCO migrants?
Anecdotally I know – and know of – a fair few who have moved north due to lower house prices. For those with WFH gigs Scotland can allow FTB’ers in particular an opportunity to get on the property ladder. The extra income taxes are brushed aside via salary sacrifice.
I’ve always said that people will move to Scotland if you give them an economic reason. Jobs and housing are always the primary drivers and WFH has enabled many to take advantage of Scotland’s lower house prices. It’s an interesting demographic shift. If it continues then the consequences might be interesting – socially, economically, politically.
> Indeed, in 2021-22 some £200m in taxable income was brought here as a result of inward migration in a single year, increasing economic activity while helping fund vital public services like our NHS and our efforts to tackle child poverty
Yes, and HMRC’s conclusion was that would have been something like £260m had it not been for higher rate taxpayers being put off moving here or choosing to leave.
It’s not the absolute numbers that matters for deciding whether this was a good idea, it’s whether another policy would have been better.
HMRC [did an actual analysis into this](https://www.gov.uk/government/publications/labour-market-participation-and-intra-uk-migration-of-taxpayers/impacts-of-2018-to-2019-scottish-income-tax-changes-on-intra-uk-migration-and-labour-market-participation#cross-border-migration) and came to the conclusion that higher tax rates here caused enough people to choose not to live here that income taxes were about £60m lower in 2018-19 than they otherwise would have been.
It’s almost as if there are reasons to live in Scotland that don’t just involve money…
Functioning public services are attractive. Ok, maybe not functioning, but slightly less shit at least. The situation is dire across the UK, but at least Scotland is trying to top up spending.
Just for interest. I earn about the UK average of £35k. Per month I am *£3* a month worse off by living here rather than anywhere else. This is before you look at other variables such as house prices (£95k higher) or water bills (10% higher)
Suddenly a few quid a month is looking very cheap.