# Scottish variable rate

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The **Scottish variable rate** (SVR) was a mechanism which would have enabled the [Scottish Government](/source/Scottish_Government) to vary (down or up) the basic rate of [UK income tax](/source/UK_income_tax) by up to 3p in the pound. The power was never used (and indeed was allowed to lapse by the Scottish Government in 2007[1]) and was succeeded by the legislative framework for Scottish public finance in the [Scotland Act 2012](/source/Scotland_Act_2012), which gives the Scottish Parliament the power to set a [Scottish rate of income tax](/source/Income_tax_in_Scotland).[2]

When legislating for the [Scottish Parliament](/source/Scottish_Parliament), a number of matters were [reserved](/source/Reserved_and_excepted_matters) by the [UK Parliament](/source/UK_Parliament) at Westminster. One such reserved matter was [taxation](/source/Taxation); however, this had been a key point in Scottish negotiations relating to parliamentary control. As a means of compromise, Westminster afforded the Scottish Parliament the ability to vary income tax, which was subsequently given the consent of the [Scottish electorate](/source/Scottish_electorate) in the second question of the [1997 devolution referendum](/source/1997_Scottish_devolution_referendum).

Therefore, the [Scotland Act 1998](/source/Scotland_Act_1998) granted the Scottish Parliament the power to vary [income tax](/source/Income_tax) by ±3p in every [pound](/source/Pound_sterling). This power was often referred to as the **tartan tax**, a phrase first used by Conservative financier and politician [Michael Forsyth](/source/Michael_Forsyth,_Baron_Forsyth_of_Drumlean) as a way of attacking the power, using the idea of '[tartan](/source/Tartan)' to get across the idea that it would be an extra tax on Scots alone.[3]

## References

1. [Scottish Variable Rate of tax no longer available](https://www.gov.uk/government/news/scottish-variable-rate-of-tax-no-longer-available)

1. ["HM Revenue & Customs: Devolved taxation in Scotland"](https://web.archive.org/web/20130411041412/http://www.hmrc.gov.uk/news/news-calman.htm). Archived from [the original](http://www.hmrc.gov.uk/news/news-calman.htm) on 2013-04-11. Retrieved 2013-04-01.

1. [Tartan Tax Tax Varying Powers for a Scottish Parliament](https://researchbriefings.files.parliament.uk/documents/SN00119/SN00119.pdf#page=15), p. 15 House of Commons Library, 31 October, 1997

## See also

- [Fiscal autonomy](/source/Fiscal_autonomy)
- [HM Revenue and Customs](/source/HM_Revenue_and_Customs)
- [Local income tax](/source/Local_income_tax)
- [Scottish Consolidated Fund](/source/Scottish_Consolidated_Fund)
- [Taxation in the United Kingdom](/source/Taxation_in_the_United_Kingdom)

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