Aggregates Tax and Devolved Taxes Administration (Scotland) Act 2024: A Comprehensive Guide
Overview
The Aggregates Levy and Devolved Taxes Administration (Scotland) Act 2024 is a significant piece of legislation passed by the UK Parliament on November 12, 2024. The Act introduces major changes to the administration of the aggregates tax (also known as the Aggregates Levy) in Scotland and devolves significant powers over certain Scottish taxes.
Key Provisions
1. Aggregates Tax
- The Act transfers the administration of aggregates tax in Scotland from the UK Government to the Scottish Government.
- The Scottish Government is granted the power to set the rate of aggregates tax in Scotland.
- The UK Government retains the power to levy aggregates tax in England, Wales, and Northern Ireland.
2. Devolved Taxes
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The Act devolves the administration of the following taxes to the Scottish Government:
- Land and Buildings Transaction Tax (LBTT)
- Scottish Landfill Tax
- Scottish Water Rates
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The Scottish Government will have the power to set and collect these taxes independently.
- However, the UK Government will retain oversight of these taxes to ensure consistency across the UK.
3. Administration
- The Act creates a new Scottish Tax Authority (STA) responsible for administering aggregates tax and the devolved taxes in Scotland.
- The STA will replace the existing Revenue Scotland, which currently administers LBTT.
- The STA will have its own board of directors and will be accountable to the Scottish Government.
4. Transitional Arrangements
- The Act includes transitional arrangements to ensure a smooth transfer of responsibilities from the UK Government to the Scottish Government.
- These arrangements will cover issues such as the transfer of staff and systems.
5. Consultation and Impact Assessment
- The Scottish Government was required to consult on the proposals for the Act.
- An impact assessment was also carried out to assess the potential impact of the Act on businesses and individuals.
Purpose and Objectives
The primary purpose of the Aggregates Levy and Devolved Taxes Administration (Scotland) Act 2024 is to:
- Transfer the administration of aggregates tax in Scotland to the Scottish Government, giving Scotland greater control over its own tax policies.
- Devolve the administration of certain Scottish taxes to the Scottish Government, enhancing Scotland’s fiscal autonomy.
- Create a new Scottish Tax Authority to manage these taxes efficiently and effectively.
Implications
The Act is expected to have significant implications for:
- Businesses: Businesses in Scotland will need to be aware of the changes to aggregates tax and the devolved taxes.
- Individuals: Individuals in Scotland may be affected by changes to the Land and Buildings Transaction Tax (LBTT).
- The Scottish Government: The Scottish Government will gain greater responsibility for tax policy and administration.
- The UK Government: The UK Government will retain oversight of aggregates tax and the devolved taxes to ensure consistency across the UK.
Conclusion
The Aggregates Levy and Devolved Taxes Administration (Scotland) Act 2024 is a major development in the devolution of tax powers to Scotland. The Act transfers the administration of aggregates tax and certain Scottish taxes to the Scottish Government, creating a new Scottish Tax Authority. Businesses and individuals in Scotland should be aware of the changes introduced by the Act and how they may affect them.
Aggregates Tax and Devolved Taxes Administration (Scotland) Act 2024
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