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A vow to scrap the two-child benefit cap and changes to basic and intermediate tax thresholds are among the plans for the Scottish government for the next financial year. The announcements were made by Finance Secretary Shona Robison as she revealed her tax and spending plans for 2025/26. Other talking points included an extra £2bn for the NHS and a £768m investment in affordable homes.
The government said they will scrap the two-child benefit cap for families by 2026. The biggest announcement in the budget actually isn’t part of the tax or spending plans for next year. It was Shona Robison’s “rabbit out of the hat” moment of announcing that the Scottish government would move to scrap – or offset, or mitigate – the two-child cap.
That’s a UK-wide policy, imposed by the Department of Work and Pensions on welfare payments such as universal credit and child tax credits – so it will take some time, and will need some help from the UK government. It’s not yet clear what the mechanism will be, how it will work, or how much it will cost.
A big focus of governments across the UK has been economic growth. The finance secretary had been challenged to match the chancellor’s support for firms in the retail, leisure and hospitality sectors – a 40% relief on business rates. Scotland has a slightly different system of “non-domestic rates”, but ultimately Robison said there would be a similar 40% relief for the vast majority of hospitality premises.
The Scottish Hospitality Group has said it is a “significantly more restricted” offer than that down south, calling it a “drop in the ocean”.
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