Tartan tax would take the Dundee cake
As Scots plans for a local income tax steam ahead, recruiters have begun warning of the dire effect it could have on jobs.
One recruiter says the tax proposals, introduced by the SNP as a replacement for council tax, will spell the death of Scotland's financial services industry.
William Finlayson of Scottish search firm Finlayson Wagner Black agrees: "People would think twice about taking up opportunities. The pool of talent is not deep enough in Scotland: a lot of businesses have to look outward from Scotland for talent and talented people would look elsewhere."
Cleodie Gladstone of recruiters Think Global specialises in international recruitment. She stresses that Scotland is "a fantastic place to work and achieve life-work balance". But, she adds, "Dublin is hugely successful on the back of tax incentives."
While Scotland is facing a brain drain, Luxembourg is trying to double its financial services population and has clear tax incentives to achieve that effect, she says.
Her view is that above a certain level, recruitment is a global market where people have choices. "Would candidates go tax free in Bermuda or apply in the local market? It's a no brainer," she points out.
Gladstone says candidates look at the "package" and its value for money. With accommodation costs in Edinburgh already amongst the highest in financial centres, anything that detracted from the package would put Scottish recruiters at a disadvantage.
Others are more sanguine. Margaret Dyer, a director at Joslin Rowe, tells us that while local taxes are a big issue in Scotland, they "would have very little effect on recruitment. Large multinationals are used to dealing with complex employment regulations and different tax regimes across the globe."
The SNP's tax proposals have already provoked controversy in the political arena. Last weekend, Yvette Cooper, the UK Treasury's chief secretary, sent a letter to the SNP finance minister, John Swinney, claiming there's a 750m "black hole" in the Scottish Government's tax plan. There will doubtless be more debate to come....
