RUTH Davidson will tonight use a speech to the Federation of Small Businesses to argue that economic growth – not higher taxes – is the way to boost public services in Scotland.
Speaking to the FSB Scotland’s annual dinner in Glasgow, she will warn that there is growing danger that Scotland will get a reputation as “one of the most costly places to set up a business in the UK”.
Instead, she will argue that Ministers should “go for growth” by backing competitive taxes to help boost Scotland’s economy, and fund schools and hospitals.
Quoting estimates from the Fraser of Allander institute, she will say that if wages and tax revenues in Scotland grow above UK levels by just a small amount, Holyrood stands to benefit by up to £1 billion extra tax revenue in 10 years time
Ruth’s speech follows SNP proposals to increase income tax last week – following similar rises in property and business taxes in recent years.
It also comes with leading business figures such as the new head of the Scottish Property Federation warning that higher taxes could be a “barrier to investment” in Scotland.
In her speech, she will also urge all governments involved in the Brexit negotiations to “step up the pace” to ensure firms get the certainty they need to plan ahead.
Reflecting on the sexual harassment scandal, Ruth will also say that politics needs “a change of culture”, with more women are promoted into positions of power.
On the tax system facing Scotland, she says:
“As the Scottish Government certainly used to argue, it is vital for Scotland’s prosperity that we retain competitive business taxes here.”
“It’s why the SNP once supported lower Corporation taxes.”
“It’s also why we oppose the Scottish Government’s doubling of the Large Business Supplement which – despite its name – impacts on many medium sized businesses as well.”
“We want Scotland to stay competitive so that we are seen across Europe as a beacon for investment, and new business.”
“The prize for getting this right is enormous. By growing the economy just half a per cent above UK levels, the Scottish Government could benefit by up to £1 billion by the end of this next decade.”
“It is wrong to continually punish firms simply for having the audacity to set up shop. Instead, we need to show that, here, in Scotland, we don’t sanction wealth creators, we support them – in the knowledge that it is only through their success - your success – that the public sector can thrive.”