Cash raised from revenues in Scotland reached a record high last year, but figures also showed “historically high” levels of public spending gave the country a £25.3 billion deficit.
Scottish Government figures for 2025-26 revealed that a total of £98.3 billion was taken in revenues – up by £6.3 billion (6.9%) from the previous year.
The increase came about after the UK Government hiked employers’ national insurance contributions – with this said to have raised £2.4 billion – while the Scottish Government’s decision to freeze higher income tax bands netted £1.5 billion.
North Sea revenue declines
However, the Government Expenditure and Revenue Scotland (Gers) figures also showed revenue from the North Sea declined again, from almost £5.5 billion in 2023-24, to less than £4.5 billion the following year and some £3.9 billion in 2025-26.
As a result, the illustrative share assigned to Scotland fell to less than £3.2 billion in 2025-26, down from nearly £3.6 the previous year and almost £4.4 billion in 2023-24.
The Scottish Government report said: “The largest decrease in revenue was in North Sea taxes (minus £0.4 billion), which reflects falling oil and gas prices during the year.”
Spending and deficit
While revenues from Scotland raised £98.3 billion, public spending in Scotland totalled £123.6 billion in 2025-26 – an increase of £5.7 billion (4.8%) when compared to the previous year.
As a result, Scotland had a net fiscal balance in 2025-26 of minus £25.3 billion – an improvement of £0.6 billion from 2024-25.
The report explained this was because “revenue grew by £6.3 billion (6.9%), while expenditure grew at a slower pace by £5.7 billion (4.8%)”.
However, this deficit was the equivalent of minus 10.9% of Scotland’s GDP.
This compares with a UK deficit worth minus 4.2% of GDP in 2025-26, with the report adding while Scotland’s position had improved by 0.6 points over the last 12 months, the UK had seen a one point improvement.
Spending per person in Scotland in 2025-26 was £22,281 compared to £19,561 per person in the UK – meaning public spending in Scotland was £2,720 higher per person than in the UK last year.
“Overall, spending in 2025-26 grew slightly faster than the economy,” the report noted, saying Scotland’s spending as a share of GDP increased to 53.1%.
It added: “Public spending remains historically high, as a percentage of GDP, almost nine percentage points higher than pre-pandemic.”
Political reaction
Scottish Secretary Douglas Alexander said: “These statistics clearly demonstrate the value to people in Scotland of being part of a strong United Kingdom.”
Mr Alexander added: “By pooling and sharing resources across the country, people living in Scotland benefit from significant additional public spending.
“That means £2,720 more per person compared to the UK average, which the Scottish Government can spend on vital services like schools, hospitals and transport.”
But Deputy First Minister and Scottish Finance Secretary Jenny Gilruth noted that the data showed “total and devolved revenues grew faster than spending”.
She stressed this showed “in the areas where our Government has control, we are delivering sustainable finances”.
Ms Gilruth continued: “The significant increase in income tax revenues shows that the decisions which this Government has taken are helping to deliver additional funding for measures to ease the cost of living like the Scottish Child payment, free prescriptions, bus travel for under-22s and free university education.”
Speaking to the Press Association, the Deputy First Minister said that Scotland does “spend more per head of population” – but said Scotland’s geography made it “much more expensive” to deliver services.
But she also stressed the “different political choices” made by SNP ministers.
Ms Gilruth said: “We take different political choices to fund free tuition, to fund the Scottish Child Payment, to fund more generous public sector pay deals as a gGvernment.
“I’m not going to make any apology for investing in our public services.”
She also said that the Gers data “provides notional estimates for Scotland’s deficit as part of the UK”, insisting that “it simply does not show what an independent Scotland’s position will be”.
The Deputy First Minister added: “With the powers of independence we would be able to chart a different path, ensuring we grow the economy to allow Scotland to reach her full potential.”
However, Scottish Labour finance spokesperson, Michael Marra, said: “These figures underline the strength of pooling and sharing resources across the UK and the additional funding available to support Scotland’s public services.
“The problem for families now is what the SNP has done with these resources. After nearly two decades in government, billions have been wasted while NHS waiting lists have grown, councils have been squeezed, and too many families remain trapped in poverty.”
Meanwhile, Scottish Conservative shadow finance secretary Craig Hoy said: “The SNP Government’s own figures reveal that Scots are now benefitting from a record Union dividend.
“Every single Scot is over £2,700 better off because we are part of a strong United Kingdom.
“Yet John Swinney and the SNP want to put an end to all of this with their obsessive push for Scottish independence.
“That would be disastrous for the nation’s finances. Things are already bad enough after two decades of SNP economic incompetence.”
Reform UK’s Scottish leader Malcolm Offord branded the figures a “damning indictment of how the SNP spends taxpayer money”.
He added: “Scotland’s tax take is now rising at a much faster rate than we are seeing invested in public services.
“Scots now have the data showing they are seeing less bang for their buck.”
And Scottish Liberal Democrat finance spokesperson, Liam McArthur, said what the “figures show is that Scots are better off from being part of a strong United Kingdom”.
But he stressed that “doesn’t mean success is guaranteed” with the Lib Dem adding: “We need a Government that is locked in on the key issues like fixing the NHS, mending Scotland’s creaking infrastructure and growing the economy.
“If that relentless focus can be accomplished there is no reason why Scotland cannot flourish.”
