The Scottish Parliament has approved the 2025-26 Budget, allocating more than £15bn to local councils and increasing investment in affordable housing.
The spending plan includes significant funding for infrastructure and measures aimed at addressing Scotland’s housing challenges, but it has faced criticism from the private rental sector over increased buy-to-let taxes.
Among the headline allocations is over £7bn for infrastructure projects, with a focus on affordable housing and the Heat in Buildings programme.
The Budget also commits £4.9bn to climate-positive investments, part of which will fund clean heat installations and energy efficiency upgrades for homes across Scotland.
Finance secretary Shona Robison said: “I am pleased that Parliament has approved the Scottish Government’s Budget – confirming plans to invest in public services, lift children out of poverty, act in the face of the climate emergency and support jobs and economic growth.
“This is a Budget by Scotland for Scotland. We are delivering a universal winter heating payment for the elderly, providing record funding for local government and increasing investment in affordable housing.”
However, the decision to increase the Land and Buildings Transaction Tax (LBTT) surcharge on buy-to-let purchases from 6% to 8% has sparked concern among landlords and industry bodies.
Timothy Douglas, head of policy and campaigns at Propertymark, said: “Propertymark welcomes the investment in affordable housing and money for the Heat in Buildings programme to help more people install clean heat and energy efficiency measures in their homes.
“However, we do not agree with the Scottish Government’s decision, through the Budget process, to increase taxes when purchasing buy-to-let property from 6% to 8%.
“The Scottish Government’s Budget has failed to implement policies that can help meet the demand for private rented property and with Scotland’s landlord taxes now the highest in the UK, this will do nothing to tackle Scotland’s housing emergency and reduce rents for tenants.”
The Budget’s housing measures aim to address affordability and energy efficiency concerns, but with private landlords facing higher acquisition costs, some warn that supply pressures in the rental market could worsen.
