Author: Benjamin Kentish
A Scottish government report has proposed giving prospective immigrants financial incentives to move to Scotland, in a bid to boost the country’s economy and offset the consequences of Brexit.
The Sustainable Growth Commission, set up by the SNP to assess the country’s economic prospects, suggested introducing a “Come to Scotland” package that would include tax cuts for highly skilled migrants.
It would see immigrants allowed to deduct the costs of their move from their income tax bill.
Such a policy would likely generate far greater revenues than it would cost, the report said.
The commission, which was chaired by former SNP MSP Andrew Wilson, said Scotland could become one of the most successful small economies in the world, with living standards that could “equal the best small countries in the world”.
It said attracting skilled migrants should be “one of the top priorities of Scottish Government economic policy”, with measures designed to offset the impact of Brexit and what it called the “UK Tory government’s hostile approach to migration”.
For example, the UK currently only offers permanent investor visas to people with at least £10m to invest. The commission said Scotland should consult on introducing a much lower cap, which would be set at £75,000.
UK restrictions stating entrepreneurs should have at least £50,000 to invest in their business before moving to the EU should also be reformed in Scotland, it said.
And the commission said the Scottish government should aim to persuade an additional 5,000 overseas graduates each year to stay in the country, including offering tax breaks to incentivise them to do so.
The report said: “Changing the visa requirements to allow more international students to stay may well be sufficient to encourage more to do so.
“However, to ensure that Scotland continues to be a competitive location and in recognition of the contribution already made to the economyand the exchequer, we recommend that international graduates from Scottish universities that stay and work in Scotland should also be incentivised to do so via the taxation system, for the first three years.”
The 429,000 people who were born outside the UK and now living in Scotland are estimated to contribute £1.3bn to the country’s economy.
Mr Wilson said: “It is a fact that those born outside the UK who have made Scotland home for their businesses, their research or their families are significant net contributors to our economy and public finances – we need more of this.
“We also need more people from across the UK to consider the benefits of living and working here.
“Our package is designed to attract people to Scotland to study and to stay here, to build a career and a fulfilling future for themselves.”
He added: “We have a great opportunity for Scotland to strike a completely different tone on a vitally important area of economic policy – how we attract talent to our country.
“Under current UK policy there is a real danger that the working population in Scotland could fall – meaning fewer people creating wealth, jobs and contributing to our NHS.”
“Growing our working population and, through it, our economy is perhaps the greatest national challenge we have – and is made even more urgent by Brexit and the threat it poses to our working-age population.”
The 354-page report said an independent Scotland should continue to use the British pound for a transition period after any decision to break away from the rest of the UK.
It also claimed reducing the country’s gender pay gap by 11 per cent could boost the economy by £6.1bn, while doubling overseas exports would add £5bn a year.
Nicola Sturgeon, Scotland’s First Minister and the SNP leader, said the report would “restart the debate” on Scottish independence.
She said: “What this report shows is that Scotland is a wealthy nation with huge resources, encompassing our traditional strengths in innovation, our hi-tech sectors, our energy reserves, our food, drink and tourism strengths – and perhaps above all our strength in human capital, with a highly-educated population.
“Despite those enormous strengths, similar-sized nations have performed better over decades – all of them independent but most of them with fewer resources than us.”
Opposition parties criticised the report and its focus on independence.
Murdo Fraser, the Scottish Conservatives’ finance spokesman, said: “Of course we want to attract the best and brightest to come and live and work in Scotland. But you don’t do that with high taxes and you don’t do it by trying to tear up the UK.
“You do it by growing Scotland’s economy – something the SNP government is failing to do, largely because it is spending so much of its time obsessing about independence.
“Four years on from the independence referendum, it really is time for the SNP to stop building castles in the sky, and to get on with the job of building a stronger Scotland now.”
Richard Leonard, leader of Scottish Labour, said: “The SNP government can attempt to reboot the case for independence as much as it likes. The people of Scotland do not trust it and want a government focused on jobs, schools and hospitals instead.