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I am conscious that we discussed that under another agenda item a few weeks ago. Some strong and clear arguments have been deployed in favour of the principle of an annual finance bill. I note that witnesses have made the point that a finance bill would help to make the system more user-friendly by bringing things together and allowing for increased scrutiny through primary legislation as opposed to secondary legislation. A range of strong arguments has been made.

Our position is that we are not opposed in principle, but it would be a significant undertaking for the Parliament. The established budget processes have been developed, to some extent, in partnership with the Parliament through the budget process review work in the previous parliamentary session and by joint agreement with the committee. Any move would represent a fundamental change. I do not state opposition in principle, but we would need to do a lot more work jointly with the Parliament. It is for the committee to determine its remit, but I imagine that it would have a key and central role to play in that work. If we were going to move to that system, it would be a significant change to how things currently operate, depending on the scope of a finance bill.

I have touched on some ideas that stakeholders suggested. To some extent, such an approach would have to be a joint undertaking. I reiterate the point that I made previously. If there is a desire to explore the matter in more detail and to establish what such a process could look like, there is a willingness on my part and that of officials to have those discussions. However, the Government cannot take that forward on its own, because it is quite a significant change. As the committee will appreciate, whether through agreements with Parliament or through standing orders, there are established budget processes, and it is important that Parliament has a key role in what any change would look like.

To avoid any doubt, I say that I am not pre-empting the budget, and I am certainly not seeking to pre-empt the 2026-27 budget, which, if Parliament agrees to the legislation, is when we would anticipate the tax going live.

The points that I speak to around continuity and certainty are really a reflection of this being a new power and a recognition of the limitations that we have with regard to data. If I were to suggest something to the contrary, questions might be raised about whether that was a responsible and proportionate approach and whether we should wait until we have more data and a greater understanding of the position.

The point about wanting stability and confidence is a direct response to what we have been told by industry through engagement. We set out the rationale for the approach of having broad alignment of the tax with what the UK has in place.

You touched on the rate of the UK aggregates levy being the same for the past 15 years. That is one element that contributes a data challenge, because we do not have a history of changes in the levy from which to assess what the response has been and whether there have been changes as a consequence of changes in the rate of the levy. As you highlight, the changes that are coming are relatively modest in scope.

This is just one tool among many. It is an important fiscal lever and the bill will increase the number of fully devolved taxes that we have at our disposal. As we accrue more data, there will be the opportunity to consider how the tax can be used in relation to other devolved taxes. It sits in a much broader policy area, where a range of other regulatory interventions and policy approaches can be taken. In considering what change can be effected via the use of the Scottish aggregates tax, it will be important to consider it not simply in isolation but as providing an opportunity for decisions on the aggregates levy to be taken in the broader context of the range of other powers that are available in, for example, pursuing circular economy objectives.

The key thing that I am keen to stress at this stage in the bill’s consideration is that we need to ensure that we take on board the concerns, views and input of those who are involved in the sector and who are most directly impacted—currently by the UK aggregates levy and in the future by the tax.

The consideration here is the administration of the tax. The tax rate will, of course, be set as part of the budget, taking into account a broader range of circumstances at that time, not least the prevailing economic climate.

You touched on understanding the impact of the tax on behaviour, which is why I picked up on your point about the rate having been the same for the past 15 years. That creates challenges around data, and there are also the existing challenges with not having—if you will pardon the pun—disaggregated Scottish data and more information on movements. That is why, as I referred to, we have jointly commissioned a survey with the UK and Welsh Governments to reflect the situation as of last year. The data from that will be available in 2025.

I appreciate the frustration about our not having more information available, but that speaks to why we are taking the prudent approach that we are taking with the bill. We recognise that we need a degree of alignment and continuity in the overall structure and administration of the tax—it is what business is familiar with—but we have flexibility on, for example, the setting of rates and other arrangements to enable a more distinctive Scottish approach to be taken in future. That will be done in a way that is consistent with our “Framework for Tax 2021” principles, by making sure that we have a fully developed evidence base and understanding of the potential behavioural responses to any tax change.

The BRIA was prepared by Government officials and was published when the bill was introduced. I come back to the point that the bill reflects the cross-party agreement in the Smith commission and the cross-party support for the Scotland Act 2016. It was agreed that the UK aggregates levy, or the tax on the commercial exploitation of aggregates, should be devolved to the Scottish Parliament. The committee is familiar with the reasons why that provision is one of the last elements of that act to be taken forward.

The key point is that there is flexibility in the bill to take quite a distinctive Scottish approach. As we are almost two years out from when decisions will be taken on that, I cannot state what that approach should be. As I said, we have not even had the stage 1 debate on the bill yet. My key focus is to ensure that there is a clear rationale for the approach that we are taking with regard to administration. That rationale is about ensuring that we have broad consistency and stability at the point of the tax being devolved, while ensuring that we have flexibility to take a distinctive Scottish approach going forward. That approach will reflect the policy objectives of the Government of the day, which I assume will reflect the distinctive aspects of the Scottish economy.

I agree that ambition is crucial. It is necessary, but it is not sufficient. Data and informed policy making are necessary, too. As I have set out, and as the committee has heard from witnesses, the challenge is that we do not have sufficient data on the way in which the UK aggregates levy operates. We have an opportunity to address that. We are, of course—

If you do not mind, convener, I will just say that there is a distinction between the rate of tax and the administration. That is the key point. I want to be clear that, when I speak about a cautious and prudent approach, I am talking about what I am dealing with directly and what is in front of me, which is the legislation. I have set out that we will—as I think everyone including the committee, the Parliament and industry would expect us to—engage closely ahead of the setting of the rate. However, I have to be candid. For the reasons that have been set out, we do not have the full range of data that we will have as the tax beds in. That is the distinction. The tax will be a fully devolved tax that is administered by Revenue Scotland with rates that are determined and legislated for by this Parliament. The committee will appreciate that VAT assignment was not the devolution of a new power; this tax is distinct in that regard.

The approach that we are taking is around the administration of the tax. I recognise the keen interest in what the rate will be, but I do not think that the committee would expect me to set out what the range of other devolved tax rates or income tax rates will be in the next budget, let alone in two years’ time. With regard to this particular tax, we will, of course, continue to engage. The position that we set out with regard to what the rate will be will reflect the engagement that we have had, and we will set out a clear rationale at that time.

I do not want my remarks to be misconstrued as suggesting that there is a predetermined course with no change. I want to make it clear that the approach that we will take is, like the approach that we have taken with the bill, one that is informed by close engagement and is consistent with the principles in the framework for tax and the new deal for business.

As the committee will appreciate, matters of enforcement and administration are properly for Revenue Scotland, as are issues with compliance. I appreciate that Revenue Scotland has set out the approach that it will take in detail to the committee in advance—

On the arguments against a finance bill—I am not advancing any such arguments on behalf of the Government—I would just reflect on the fact that, in our existing system, tax changes are made through secondary legislation. Occasionally, we will bring forward primary legislation on tax, such as that which we are considering this morning, which will afford opportunities for wider reforms, but I recognise the criticisms of that approach, too. In considering any changes, I would want to ensure that we fully understand the full range of views. However, as I have said, I am sympathetic to the position that has been put forward.

I appreciate that we do not have any direct control over this matter, but—this goes back to a point that I made earlier—our overall ability to scrutinise the public finances in Scotland would be enhanced if the UK Government took a certain approach with regard to its own budget-setting process. However, I am not going to rehearse all the arguments, as we have been through them before.

There might be an opportunity in how Parliament might wish to consider the matter. Yes, this is, first and foremost, about holding the Government to account and scrutinising its position through the Parliament’s own processes, but it is also about looking at the wider UK fiscal framework and how the UK Government itself operates. That approach would certainly assist the Government, but it would be of use to the Parliament, too. I appreciate, though, that we have no direct control over that. I would certainly be more than happy to engage with the Parliament in conversations and discussions about issues of fiscal transparency and engagement with regard to what any finance bill or process would look like. If the committee wanted to do a bit of work on the matter, I and my officials would be happy to engage with it.

I think that that just reflects the existing arrangements that were in place for the taxes that were devolved previously. We have set out some estimates based on the costs when those taxes came online and what the process entailed. Jonathan, do you have anything to add?

It is an important area to explore. Certainly, the Government has its approaches. However, I am also conscious that non-ministerial offices are directly accountable to Parliament. Although they are part of the Scottish Administration, they have autonomy and independence in how they operate. In the case of Revenue Scotland in particular, we all recognise why that is important.

With regard to how NMOs would seek to adopt automation processes, AI and so on, Parliament has the opportunity to directly scrutinise the work that those offices undertake. Parliament will scrutinise the legislative framework within which Revenue Scotland will operate. We have responded to the points that have been raised with us by Revenue Scotland. Bringing forward the regulation-making power will allow us to ensure that we do not inhibit Revenue Scotland’s ability to adopt AI approaches that would benefit users of the tax system and, indeed, the overall delivery of public services.

I appreciate the point that you make. In this context, because it is a regulation-making power, some of the points that we are starting to touch on relate more to the regulations themselves and interrogating what is brought forward—