Wales ‘shackled’ on income tax powers

Leanne Wood sounds warning on Welsh powers following Scottish changes00_Leanne_Wood_AC.jpg

Plaid Cymru Leader Leanne Wood has sounded the alarm on forthcoming Welsh income tax powers.

The Welsh Government will be able to set half of income tax from April 2019.

The Scottish Government has just announced its own plans, and intends to create new thresholds in order to deliver tax cuts for a majority of taxpayers, with higher earners paying slightly more.

However, Plaid Cymru is raising the warning that Wales is not being granted the power to create new thresholds.
Wales will be able to vary taxes in the three existing bands only. This means the scope for generating revenue is limited, and that tax cuts would be far more costly to the Welsh budget than is the case in Scotland.

Ms Wood is writing to the First Minister and the UK Government to call for negotiations on expanding and improving the income tax powers which are coming to Wales by 2019.

Leanne Wood said:

“Plaid Cymru wants fair taxes for Welsh citizens. Westminster doesn’t work for Wales, so we want to make our own decisions over income tax here.

“One way of doing this is to create new thresholds, which enables governments to be flexible.

“But the powers being transferred to Wales are limited, and we can’t create new thresholds. We will be shackled to UK Government thresholds which don’t reflect Welsh needs.

“Any tax cut becomes expensive to public services. And any tax increase can only raise money if it is applied to the lower earners.

“This is unfair, inflexible and inefficient, and means that Welsh taxpayers are missing out.

“I want to raise the alarm on this so that Welsh party leaders can speak out. We need to ask the UK Government for negotiations as soon as possible, so that this can be looked at again.”

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