Scottish Budget sets out proposed changes to devolved taxes

12 December 2018

Cabinet Secretary for Finance, Economy and Fair Work, Derek Mackay MSP, has today announced plans to increase the current 3% rate of Additional Dwelling Supplement (ADS) to 4% from 25 January 2019.

In his Budget Statement to Parliament, Mr Mackay also set out the Scottish Government’s intention to change Land and Buildings Transaction Tax (LBTT) rates for non-residential transactions from the same date.

The proposed non-residential rates and bands are set out in the table below.

Purchase price LBTT rate
Up to £150,000 0%
Above £150,000 to £250,000 1%
Above £250,000 5%

Under the proposals, where the effective date of a non-residential LBTT transaction is on or after 25 January 2019 and the contract was entered into before 12 December 2018, the tax rates and bands for ADS and non-residential LBTT transactions that were in force prior to 25 January 2019 will apply.

Scottish Landfill Tax

The Budget Statement also set out proposals for Scottish Landfill Tax rates to rise in line with inflation from 1 April 2019, thus continuing to match tax rates in other parts of the UK.

  Proposed 2019-20 2018-19 rates
Standard Rate £91.35 per tonne £88.95 per tonne
Lower Rate £2.90 per tonne £2.80 per tonne

The credit rate for the Scottish Landfill Communities Fund will remain at 5.6%. 

The Scottish Budget will now be considered through the Scottish Parliament’s formal Budget scrutiny process prior to implementation, and Revenue Scotland will work closely with the Scottish Government to prepare for the proposed changes.

Updates have been made to online guidance and the Revenue Scotland LBTT calculator to reflect the proposals and help agents and taxpayers understand the likely impact.