DEREK Mackay has downplayed the prospect of income tax hikes next year, telling the SNP conference that “taxation is not a toy” and he would take the “responsible” course.

However the Finance Secretary suggested the threshold for the 40p rate would remain frozen at £43,000 for a second time in 2018/19, while it is increased south of the border.

The Chancellor raised it to £45,000 in April and it is due to increase to £50,000 by 2020.

The freeze currently means high-earning Scots pay up to £400 more than their counterparts in England and Wales.

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Mr Mackay said he would not follow the Tory tax policy.

He said: “Our approach to tax stands in stark contrast to the Tory Government at Westminster. Where we choose progressivity, they choose tax cuts for the richest.”

The Finance Secretary also called for more powers over tax to be devolved to Holyrood, and announced he had written to the Chancellor asking for higher public sector pay.

Mr Mackay’s cautious note coincided with a new YouGov poll showing marginal support for higher overall income tax to pay for public service, and opposition to a rise in the 20p rate.

Nicola Sturgeon last month called for debate on more “progressive” income tax, making it clear she was open to rises on the basic 20p, upper 40p and additional 45p rates.

A penny rise across all bands would raise an extra £500m a year.

She also asked the other parties at Holyrood to send her their proposals on tax, so they could be fully costed by civil servants to inform a forthcoming paper on tax.

The exercise is intended to make it clear how much every proposal would raise, and how show how many people it would affect.

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Mr Mackay told the conference that “to their credit” the Greens and Liberal Democrats had both submitted plans, but there had been “nothing” so far from Labour and the Tories.

He said: “Setting taxes isn’t easy. Taxation isn’t a toy - it has an impact on people’s lives and their choices and as a government we take that responsibility very seriously.

“Like we do with all taxes under our control, we will take a responsible approach to income tax. Yes, we can set rates and bands, but Westminster remains responsible for the tax base, what is considered to be income, and how it is measured.

“It is also responsible for the personal allowance and for reliefs. Like in so many other areas, when it comes to income tax, we have one hand tied behind our back.

“Don’t just take my word for it, the Fraser of Allander institute said, that when it comes to income tax, we have ‘half the lego set’.

“As Finance Secretary, I will never settle for the situation where the Scottish Parliament is only responsible for raising a third of our income.”

He said he had also asked the Scottish Land Commission to research the introduction of a Land Value Tax - an olive branch to the Scottish Greens ahead of budget talks.

The YouGov poll found 45 per cent of Scots supported an overall rise in income tax to fund public services, 41 opposed and 14 per cent undecided.

There was very strong support for raising the 45p rate paid by those earning more than £150,000, with 70 per cent in favour, 18 per cent opposed and 12 per cent undecided.

However only 17,000 Scots pay the additional rate, and a raise would not yield a great deal.

There was less support for raising the 40p rate paid by 360,000 Scots earning over £43,000, with 57 per cent in favour, 29 per cent opposed and 16 per cent undecided.

But there was opposition to raising the 20p rate paid by 2.2m people earning over £11,500, which could potentially yield the greatest sums.

The poll found 45 per cent of people against, 39 per cent for and 16 per cent don’t knows.

Mr Mackay said the failure of Labour and the Tories to supply tax proposals showed they were not serious about engaging ahead of the 2018/19 draft budget in December.

He said: “Labour are pre-occupied fighting each other. But the Tories? The real reason that they have been silent on tax is that their position simply does not add up.

“Day after day, week after week, the Scottish Tories call on the Scottish Government to spend more money, yet at the same time call for tax cuts for the richest in the country.

“Conference, they’re taking the Jackie Ballie,” he said, a reference to the Labour MSP recently accused of talking “p***” in the party’s bad-tempered Scottish leadership contest.

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Mr Mackay also confirmed his commitment to ending the 1 per cent public sector pay cap next year “come what may”, but warned the rise would depend on the UK Treasury.

He said: “But there is something I must make clear, if austerity is not lifted, our ability to offer the kind of deal we might want to will remain constrained, no matter what powers we use.

“The majority of our budget is still determined by decisions in London. That is why the UK Government must lift the cap across the UK, and fund the pay rise that people deserve.

“That is why today, along with the General Secretary of the STUC, I have written to the Chancellor, calling for him to do just that.”

He also urged Mr Hammond to end the “ludicrous and unjust Treasury position of imposing VAT on Scotland’s police and fire service”, which could cost Holyrood £280m by 2021.

Ms Baillie said: “Derek MacKay has a cheek to stand on stage and talk about austerity from Westminster when his government has spent its time in office slashing local authority budgets.

"The finance minister has the power in his hands to take a different path from Tory austerity, yet he has repeatedly refused Labour's demands to use the powers of the Scottish Parliament. "The only Party that offers not just talk, but action on ending austerity in Scotland, is Labour."