New Devolved Tax Powers Proposed For Wales

October 8, 2014 Taxation in UK

LONDON – Welsh taxpayers will soon be able to decide if the national government should be granted increased power to set the rate of income taxes in the country.

On October 7th the UK government published the proposed amendments to the Wales Bill, which may, if approved, grant the government of Wales significantly extended tax settings powers.

Previously the under the conditions of the Wales Bill, the government of Wales could be granted the devolved power to set the rates of income taxes, however, the power was restricted by a “lock-step” condition, whereby the rates of income tax had to be varied for all tax rates simultaneously, however, under the revised bill, the restriction has been removed, allowing the government to vary any rate independently for each tax band.

However, the power to set variable tax rates will only be granted if it receives the support of Welsh taxpayers in a national referendum.

Alongside the power to set the rate of income tax, the Wales Bill also details measures which would allow the government of Wales to decide on borrowing, as well as setting and collecting a selection of minor taxes.
The amendments to the Wales Bill are scheduled to be debated in the UK Parliament next week.

Photo By: National Assembly for Wales