THE boss of Young’s Seafood has warned that raising income tax in Scotland would inflict ‘serious’ damage on the business by encouraging senior staff to leave the country.
Peter Ward, the chief executive of Young’s, in a submission to Holyrood’s devolution committee, also said his company would incur costs over the red tape involved in distinguishing Scottish from UK income tax payers.
He called for guidance on the issue, telling MSPs some of his workers split their time between Scotland and England.
Young’s, part of the Findus Group, is currently assessing the employment situation at its plants following the loss of a major salmon processing contract to rivals Marine Harvest. Jobs are certain to go but when and where still has to be announced.
The company employs 2,000 permanent staff in Scotland – in Annan, Livingston, Fraserburgh and Spey Valley – and a further 1,000 temporary workers during seasonal peaks. It employs another 2,000 at its three plants in Grimsby.
The Scottish government complained recently that Westminster’s granting of £1.34 million in regional funding to help Young’s develop its Grimsby faculties was unfair treatment.
The SNP Banff and Buchan MP Eilidh Whiteford clashed with David Cameron at Prime Minister’s Questions earlier this month after she accused the UK government of ‘encouraging and supporting’ Young’s to relocate some 900 jobs in Fraserburgh to Grimsby.
‘What is the Prime Minister going to do to support the workers in Fraserburgh?’ she asked.
The Scottish government will set a Scottish Rate of Income Tax (SRIT) for the first time next year, taking effect at the start of the financial year in April.
Holyrood will be responsible for raising about half the tax levied in Scotland initially.
However, under the Scotland Bill now before the Commons, it will take almost complete control over income tax from 2017 or 2018.
Finance Secretary John Swinney is not expected to deviate from UK rates when he sets his budget for the next financial year, Glasgow’s Herald reported, but First Minister Nicola Sturgeon has hinted she wants to raise taxes on the wealthy when the full powers become available.
Ward said the SRIT threatened to increase costs ‘at a time when economic recovery is still underway and when we find ourselves operating in a very challenging and competitive market place’.
The Scottish government confirmed it would set the SRIT as part of its budget process for 2016/17.