Scottish election 2026: How tax and welfare are shaping the vote

Scottish Election 2026: Tax and Welfare Policies at the Heart of the Campaign

A New Focus on Fiscal Policy

While Scottish Parliament elections have historically revolved around public services like education and healthcare, this year’s vote is expected to center on fiscal decisions, particularly tax and social welfare. Since 2017, Scotland has diverged from the rest of the UK in its approach to income tax and benefits, with the gap widening after the SNP secured a majority in the 2021 Holyrood election. The upcoming election on 7 May offers voters a chance to assess the SNP’s policies and compare them with alternatives proposed by opposition parties.

Scotland’s Tax System: A Split Decision

Every UK adult receives a £12,570 personal tax-free allowance. However, Scotland’s system introduces six income tax brackets, unlike the UK’s three. This results in lower earners paying slightly less tax than their counterparts in England, Wales, or Northern Ireland, while middle and higher earners face significantly higher rates. The Institute for Fiscal Studies (IFS) estimates that 55% of Scottish taxpayers earning up to £33,500 annually will see a marginal financial benefit, amounting to no more than £40 yearly (77p weekly). Conversely, those earning over £33,500 pay extra, with a £50,000 salary leading to an additional £1,500 in taxes, rising to £5,200 for £125,000 earners.

SNP’s Vision for Redistribution

The SNP government in Edinburgh frames its tax model as a progressive system designed to reduce inequality. By increasing tax rates on higher incomes, they argue, more resources can be directed toward supporting vulnerable groups. Yet economists have questioned this, noting the system’s abrupt tax rate changes might discourage individuals from earning more, potentially slowing economic growth.

A Personal Perspective on Tax Burdens

For Jenna Lindsay, owner of Cafe Continental in Gourock, the political discourse on taxation feels distant from daily struggles. “It’s full on,” she says.

“You’re like, how am I working all this and I’ve got nothing to show for it? It’s hard.”

“It’s probably just a mix of everything. You earn a wage, and then it all gets taken off—taxes and the cost of living, everything’s going up,” she adds.

Social Security Boosts

Since 2007, the SNP has expanded social security spending, with a major move in 2021 introducing the Scottish Child Payment (SCP). Initially £10 weekly per child under six, the benefit has grown to £28.20 and now covers children up to 15 years old. First Minister John Swinney has pledged to raise the payment to £40 for families with infants under a year old if the SNP wins the 2026 election.

Laura Derrick, a mother of three in Inverclyde, highlights the SCP’s importance. “It’s really important,” she says.

“Without it—and UK child benefit—we’d be really struggling.”

Despite working 12-hour night shifts as a carer and her husband’s employment, the family finds it challenging to manage expenses. At the Boglestone community center in Port Glasgow, funded by both Scottish and UK governments, she explains, “We’re not choosing to work less; we’re doing the best we can, and that extra help makes a real difference.”

Measuring Poverty in Scotland

The Joseph Rowntree Foundation (JRF) reports that 210,000 children in Scotland live in relative poverty, defined as households with income after housing costs below 60% of the UK median. This underscores the ongoing debate over whether Scotland’s fiscal policies are effectively addressing inequality or inadvertently creating additional strain on families.