IFS think tank casts doubt on Tory tax plans – Daily Business

Russell Findlay unveiling the party’s manifesto (pic: DB Media Services)

Scottish Conservative plans to cut taxes and shrink the state would involve “substantial cutbacks”, according to a leading think tank.

The Institute for Fiscal Studies has cast doubt on the party’s “credible and costed” manifesto commitments that promise to cut the benefits bill and “get Scotland working”.

Russell Findlay launched the party’s manifesto on Tuesday, led by a clampdown on “obscene waste” in the public sector, cuts to income tax and reforms to reduce the cost of doing business.

To fund the tax cuts, alongside £2 billion a year in new spending, the Tories outlined a plan to generate around £6bn in savings by 2031–32, primarily by slashing the benefits bill and government bureaucracy.

The IFS welcomed pledges to simplify income tax and business rates but cast doubt on the savings, which would require “specific and potentially difficult policy choices”.

The think tank did, however, praise the level of detail laid out by the Tories in both the manifesto and its costing document.

“Taking the entire package of measures together, this may be a costed plan on paper but whether it would survive contact with reality is far from clear,” said David Phillips, the head of devolved and local government at the think tank.

“Scotland can have lower taxes and higher spending on some services – but giveaways on the scale proposed by the Scottish Conservatives cannot credibly be funded largely through back-office and administrative savings.

“In addition to the cuts to benefits set out in the manifesto, there would likely need to be substantial cutbacks to either the range or quality of some services used by households and businesses too.”

Scottish Conservative finance spokesman Craig Hoy said: “We welcome the scrutiny from the IFS about our manifesto, which is the most comprehensive the Scottish Conservatives have produced for a Holyrood election.

“It is pleasing they are supportive of our plans to simplify Scotland’s income tax and business rate systems, and that they appreciate us proactively publishing a costings document alongside our manifesto.

“Our bold and ambitious manifesto would get Scotland working again after two decades of SNP failure and sets out a different way for Scotland after 25 years of a high-tax, high-spend agenda at the Scottish Parliament.

“However, we disagree with the IFS’ assessment that savings cannot be made to the huge amount of bureaucracy that has spiralled out of control under the SNP, which even they have admitted is too large.

“We are the only party being honest with Scots about the £5bn blackhole facing the public finances due to SNP mismanagement.

“And the IFS’ independent analysis is in complete contrast to how they demolished Reform’s manifesto, whose numbers simply don’t add up.”

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