This project will provide a comprehensive empirical analysis of the behavioural and distributional effects of Scottish Income Tax divergence from the rest of the UK. Since 2018, Scotland has introduced distinctive tax rates and bands, creating a quasi-experimental setting to understand how tax affects work incentives, income adjustment behaviours, and household welfare. With National Insurance thresholds remaining aligned across the UK while income tax thresholds diverge, and relevant elements of the benefit system such as Child Benefit and the High Income Child Benefit Charge, are reserved to the UK Government, understanding the combined effects on different household types is crucial for evidence-based policymaking.
The research will address some core questions, such as:
– How the Scottish tax-benefit system affect household-level work incentives, particularly for second earners
– What behavioural responses occur around key thresholds such as the higher-rate threshold and High Income Child Benefit Charge?
– How cost-of-living variations by household type and location inform debates on tax competitiveness and fairness?
Using rich administrative and survey microdata from HMRC and DWP, the project will employ advanced quasi-experimental methods, leveraging Scotland as a treatment group with the rest of the UK as a comparison.
The collaboration with the Scottish Government is central to this project’s success. This will include collaborative work with the Scottish Government which will provide the student with access to restricted administrative data, opportunities to engage with policy practitioners, and experience translating academic research into policy-relevant outputs. The student will be embedded within Strathclyde’s Fraser of Allander Institute, a leading economic research centre with established expertise in Scottish tax analysis and strong knowledge exchange capabilities.
Outputs will include research papers for peer-reviewed journals, policy briefs, and knowledge exchange activities through the Fraser of Allander Institute’s influential platforms, ensuring maximum impact for both academic and policy audiences.
As this studentship involves working within Scottish Government, the student will need to pass the Baseline Personnel Security Standard (BPSS) before this part of the research commences. Part of this entails verifying that the student meets the Civil Service Nationality Rules – see the Annex C flowchart to check eligibility for non-reserved posts. These requirements apply to all individuals conducting work within the Scottish Government, including PhD researchers.
By applying for this studentship, you are affirming that you have understood these requirements and expect to be able to pass BPSS. We will screen applications as part of the recruitment process to ensure eligibility requirements are met.
Collaborative Partner: Scottish Government
Supervisory Team:
- First Supervisor: Dr João Sousa, joao.sousa@strath.ac.uk
- Second Supervisor: Dr Otto Lenhart, otto.lenhart@strath.ac.uk
- Third Supervisor: Professor Stuart McIntyre, s.mcintyre@strath.ac.uk
