Another tax hike from the profligate SNP will drive away those who are the lifeblood of this country, writes Liz Smith, Scottish Tory Finance spokesperson

The SNP is getting ready to unveil a Budget that Shona Robison, the Finance Secretary and Deputy First Minister, has already said will require ‘tough choices’. It’s now painfully clear what the Nationalists mean by that – namely, that they intend to punish hard-working Scottish households even more than is the case just now.

It is widely reported that Humza Yousaf will try to plug the big black hole in the SNP’s public finances by introducing another tax band.

If true, this will hit middle and higher-earning workers really hard. That wouldn’t just be disastrous for Scottish taxpayers – who are already the hardest-hit in the UK – it would also be a sure way of discouraging people from wanting to live, work and invest here.

Widening the tax gap – which could mean Scottish-based workers paying thousands more than someone on the same salary elsewhere in the UK – will drive away exactly the kind of workers that are crucial for Scotland’s future economic growth and the delivery of more efficient public services.

Doctors, dentists and entrepreneurs – exactly the people we need to attract, but who are not currently moving to Scotland – will all have an even greater incentive to ­relocate elsewhere if these tax increases go ahead.

This further increase in the tax burden will lead to behavioural change. That is even a concern shared by some in the SNP, who are very aware of the damage that this is likely to wreak on the economy.

They know only too well that the analysis undertaken by the respected Fraser of Allander ­Institute shows that the money raised by this additional tax burden would be a drop in the ocean ­compared with the scale of the budget shortfall.

Despite all this, and some dissent within its own ranks, the SNP has decided to opt for disincentives rather than accept the importance of promoting growth, which is the number one ask of business and industry.

There could be no clearer sign that the SNP’s rhetoric about a ‘reset’ relationship with business, much-touted immediately after Humza Yousaf was installed as First Minister, was hogwash.

There were already strong indications of that last year, when the Scottish Government failed to pass on the significant sums provided by Westminster to enable them to match the business rates relief offered in other parts of the UK.

As a result, Scottish firms – ­particularly those in the struggling leisure, hospitality and tourist ­sectors – have been operating at a disadvantage.

Instead of taking steps to correct that, the SNP introduced (or attempted to introduce) a whole raft of regulations and costs – from the alcohol advertising ban to the disastrous short-term lets legislation – to make the lives of businesses even more difficult.

It is therefore essential that, in this Budget, the Barnett Consequentials from business rates relief in the rest of the UK are passed on to Scottish business.

This short-sighted hostility towards business, which is ­compounded by the SNP’s alliance with the openly anti-growth Greens, is at the root of the problem.

The £1 billion black hole in our public finances that Shona Robison had to admit to earlier this year, and to which another £500 million appears to have been added, is largely as a result of the SNP’s ­dismal record on growth over a long period of time. Since Nicola Sturgeon became First Minister in 2014, Scotland’s GDP growth has been around half that of the UK as a whole, starving the economy of billions of pounds.

 Rhetoric about a “reset” relationship with business was hogwash

It is that persistent failure to stimulate economic growth which lies beneath so many of our problems – the lack of money for local government frontline services, for education, policing and transport, and for crucial infrastructure projects, including the SNP’s long-standing promise to dual the A9, which remains undelivered.

Then there are other self-inflicted wounds. Nothing has been done to improve efficiency or make ­savings and reforms in the public sector – something the ­Scottish parliament’s own finance committee has called for, along with Audit ­Scotland. It seems that the Scottish Government just will not accept the necessity for reform.

But another component of the current financial mess was Humza Yousaf’s last-minute U-turn on council tax two months ago.

Without any consultation with Cosla, or even with his own ­Cabinet, he announced a freeze without explaining where the money would come from. That may be exactly the kind of irresponsible approach to government that characterises the Nationalists but it will have devastating impacts for the long-term sustainability of council services. Instead of accepting that the decisions they have taken come with a hefty price tag, the SNP always lays all of the blame at the door of ‘Westminster’, ‘austerity’ or ‘the Tories’.

All responsibility for failure – despite the fact that most powers are devolved and the SNP has been in government for more than a ­decade and a half – can be ­disowned. And the answer to everything, ­naturally, is independence.

Over the same period that the SNP has been in government, the UK Government has supplied the largest block grants in history. This year that stood at £42 billion, even before Barnett Consequential ­payments from the Budget added £320 million, and the Autumn ­Statement resulted in another £545 million.

 Millions of pounds have been needlessly squandered over the years

Much of the enormous shortfall in the Finance Secretary’s arithmetic could have been made up by money that the SNP has needlessly squandered over the years. The millions spent on the ferries fiasco, botched nationalisations and failed business deals such as BiFab and the Lochaber smelter, plus a string of doomed and pointless court cases, would have come in handy next week. But it’s too late for that.

It seems certain that we are in for further savage cuts to Scotland’s infrastructure and public services, many of them affecting local ­government, which provides so many public services on which we depend. Little wonder that a report last week warned that a quarter of Scotland’s local authorities are in danger of bankruptcy.

During any Budget process, the opposition parties have a duty to spell out what they would do differently and how they would reallocate spending.

The Scottish Conservatives will do that and we will begin by ­repeating our demands that the SNP scraps its highly contentious and very expensive proposals for a National Care Service.

No fewer than four Holyrood committees have expressed ­concerns about this proposed ­legislation, the price tag for which now seems to be close to double the original estimate of £1.26 billion.

No one – least of all Shona ­Robison – is going to be able to fix overnight the ­abysmal mess that the SNP has made of Scotland’s finances, or instantly undo the damage that it has inflicted over 16 years in power.

But there are substantial savings that would make a start. The chief priority must be to encourage growth, productivity and ­enterprise. We must back Scottish businesses, support local government, and prevent an even greater tax differential between Scotland and the rest of the UK.

Sadly, all the indications are that the SNP is preparing to introduce measures that will do exactly the opposite.