The potential economic impacts of "DevoSmith" powers

There has been extensive debate since the referendum around which powers should be devolved to Scotland, but there has been rather little consideration so far given to the likely impact that any new powers could have on the Scottish economy. Yet the success of future Scottish Governments will ultimately depend on how well they use any new powers to achieve their policy objectives. Given the proposals of the five main political parties in Scotland, additional powers over income taxation are inevitable. We discuss the likely content and economic impact of “DevoSmith” in detail elsewhere. In this chapter we focus solely on the likely impact of varying income tax rates and recycling revenues to allow greater public spending.