Tax and spending plans to be revealed in Scottish Budget

What to expect in the Scottish budget?

Help for families struggling with the cost of living crisis
‘Strong investment’ for the NHS to tackle long waiting times
Measures to reduce child poverty following the UK Government’s decision to scrap the two-child benefit cap
No increases in income tax rates and bands

The Scottish Government’s tax and spending plans are to be revealed in the pre-election Scottish Budget on Tuesday afternoon.

The First Minister promised that the Budget for 2026-27 will be focused on helping families struggling with the cost of living crisis, as well as providing “strong investment” for the NHS.

John Swinney said he hoped the Budget could help build on what he insisted was “significant progress” made by the NHS in tackling long waiting times that have accumulated since the Covid pandemic.

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What can we expect in the Scottish budget?

The First Minister promised that the Budget will be focused on helping families with the cost of living crisis and providing ‘strong investment’ for the NHS.

The First Minister said his government will also take steps to invest in boosting the Scottish economy.

Finance secretary Shona Robison previously said that her tax and spending plans for the year ahead would stand in “stark contrast” to Westminster policies that she believes are “holding Scotland back”.

The Scottish Budget has come later than usual, reflecting the timing of the UK Government’s Autumn Statement in November and the time required to assess its implications for Scotland’s public finances.

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The Scottish Government will set out its tax and spending plans for the next financial year at Holyrood on Tuesday.

The UK Government confirmed that Scotland is expected to receive an additional £820m in Barnett consequentials by the end of the decade.

The decision to remove the two-child cap on benefits will also free up funding that had previously been allocated by the Scottish Government to offset the policy’s impact.

The First Minister has said the extra headroom will be used for other measures to eradicate child poverty.

From a personal tax perspective, Swinney previously promised that income tax rates and bands would not increase in the forthcoming Scottish Budget.

However, without changes to thresholds, some taxpayers may still see higher liabilities over time as earnings increase, according to the Edinburgh Chamber of Commerce.

Scottish Labour leader Anas Sarwar previously admitted his party is “not in a strong negotiating position” on the Budget, after he announced the party will not stand in the way of the Government’s tax and spending plans.

Scottish Labour members are expected to effectively allow the Budget to pass, with Sarwar instead focused on May’s election.

The minority SNP Government usually needs to find support from other parties for its plans to be approved, but with Labour’s promised abstention, the proposals are guaranteed to be approved.

Swinney insisted he was still keen to “work with others” and “create common ground” around the proposals.

Ahead of the announcement on Tuesday, Scottish Liberal Democrats finance spokesman Jamie Greene said his party wanted to see movement on colleges, councils, mental health, childcare, business rates and a “fair deal” for islanders.

Roz Foyer, general secretary of the STUC, urged the Government to use the Budget to benefit the lives of Scots, rather than to boost the election chances of the SNP.