Reform Scotland, the independent non-party think tank, says that the UK’s exit from the EU has removed the major block on devolving VAT to Holyrood.
The call has been made in a new research paper – Unfinished Business – released today.
VAT devolution, which was discussed by both the Calman Commission and the Smith Commission, and supported by the Scottish Conservatives, was prohibited by EU law, which prevented variation in sales tax within an EU state.
However, Brexit means that this can now be done, and Reform Scotland has called on Chancellor Sajid Javid to heed the word of his Scottish colleagues and devolve VAT to Holyrood.
In its Smith Commission submission, the Scottish Conservative Party said: “Were it not illegal under EU law, we would have been inclined to recommend that VAT be devolved to the Scottish Parliament.”