British troops set to be left out of pocket due to Income Tax changes in Scotland will be protected under plans announced by the Ministry of Defence (MoD).
Defence Secretary Gavin Williamson unveiled the plans to compensation around 8,000 personnel, who would otherwise by negatively affected by the Income Tax hikes, with an annual payment.
The intention is to ensure that all troops, regardless of where they are deployed or where their families are based, pay the same income tax.
“It is completely wrong for the brave men and women of our Armed Forces to be punished for serving in Scotland by unfair raids on their pay packets by the Scottish government,” said Williamson. “That’s why we have taken this urgent action to ensure that our troops are treated equally and fairly.”
The financial mitigation measures will be payable to all regular personnel who pay Scottish Income Tax, regardless of where in the world they are serving. Mitigation payments of between £12 and £1,500 will be paid.
The single payment will apply to the tax year 2018/19 and will be made retrospectively. The MoD said that the case for financial mitigation would be reviewed annually. The annual cost to the MoD for the 2018/19 tax year is expected to be £4 million.
Scotland Secretary David Mundell added: “The Scottish government’s decision to make Scotland the most highly taxed part of the UK means they would be unfairly penalised and it’s absolutely right that the UK government has taken steps to address that.”
