Scotland’s emergency services have been “needlessly deprived” of resources by the UK Government’s refusal to refund VAT charges, it has been claimed.
SNP MSP Tom Arthur suggested that people in Scotland had been left short-changed due to Police Scotland and the Scottish Fire and Rescue Service having to make VAT payments over a five-year period.
A decision was made to overturn the policy in 2017, with the change coming into effect in March last year.
It means that the services are no longer required to pay the VAT, however the Scottish Government has called for the money to be refunded.
Speaking at the Scottish Parliament last month, Justice Secretary Humza Yousaf indicated that the UK Government was refusing to do so.
It is estimated that the VAT owed could amount to more than £125 million.
Mr Yousaf said: “Members will know that we welcome the VAT policy change that came into effect in March 2018.
“However, that did not address the issue of VAT that had already been paid to Her Majesty’s Treasury between 2013 and 2018.
“Having conceded the principle that it is unfair to charge VAT only to our services, the UK Government has refused to pay back £120 million to the Scottish Police Authority and about £50 million to the Scottish Fire and Rescue Service.”
SNP MSP Tom Arthur said that the UK Government must pay back the costs.
“The Tories continue to short-change the people of Scotland on a range of issues due to their arrogance and incompetence,” said Mr Arthur.
“Their inaction has led to millions of pounds of cuts to our public services at a time of brutal austerity.
“The VAT charge for Scottish police and fire services was another Tory policy that was completely unfair to Scotland – they were the only territorial forces in the UK to be charged VAT, costing frontline services millions of pounds.
“It’s shocking that the Tory government will happily squander billions on a Brexit shambles of their own making, or a pay-off for the DUP – but refuse to refund punitive VAT charges which have needlessly deprived Scotland’s emergency services of extra resources.
“For example, nearly 2,000 new police officers in Scotland could be fully trained with the £125 million owed to Scotland – that would be a start.
“The damage being done to our essential public services by Tory austerity, cuts, and wasted funds is completely unacceptable. It’s time for the UK government to step up and give Scotland what we are due.”
A UK Government spokesman said: “When the Scottish Government created national fire and police services it did so in the full knowledge they would be liable for VAT.
“The UK Government scrapped the VAT charge in 2017, saving Scottish police and fire services around £40 million per year.
“It would not be appropriate for the UK Government to compensate retrospectively the Scottish Government for their own policy decisions.”