The creation of Yousaf’s company, disclosed in The Times earlier this month, came the day after it emerged that Ms Sturgeon’s firm had been paid £25,000 plus VAT for her appearance as a pundit on ITV’s general election night coverage.
Her company, Nicola Sturgeon Ltd, received the money from ITN for her running analysis of the election, which saw the SNP routed in Scotland.
She accepted the engagement despite the SNP under her leadership demanding the resignation of Ruth Davidson, the former Scottish Tory leader, for taking £7,500 for a similar punditry role in the 2019 election.
Ms Sturgeon previously registered £75,000 as the first of four instalments of a book advance she received for her memoirs, which are scheduled to be published next year.
In Holyrood today Mr Ewing – who did not mention Ms Sturgeon or Mr Yousaf by name – pressed finance secretary Shona Robison on the use by individuals of companies to reduce their tax liabilities.
“Is she concerned that the overall tax revenue from income tax is being reduced by some people, and I mentioned no names, who choose to set up a limited company, who then appear able to insert into that company’s income, income from, for example, book royalties or TV appearances, and thereby reduce their liability to income tax and the amount of money for Scottish public services. So does she deprecate the use of that device?”
Ms Robison responded: “I can say to Fergus Ewing that our approach to tax is founded on on core principles which ensure that everyone pays their fair share of tax and we support very strong measures to tackle tax avoidance and evasion.
“We continue to work with the HMRC, through our service level agreement to ensure that Scottish income tax is collected, efficiently and reliably. And to date, there’s been no evidence that Scottish taxpayers have been more likely to engage in non compliant behaviour for the rest of the UK.”
Earlier this month it emerged Mr Yousaf registered a company, titled H & N Yousaf Ltd, at the address of his father’s accountancy business in Glasgow. He and his wife, Nadia El-Nakla, are listed as joint shareholders.
His register of interests at Holyrood has been updated to state that the company offers “business support services” and on Sept 23 this year was paid £2,400 for “presentations delivered at the Centre for Humanitarian Dialogue in Geneva”.
However, the creation of the company raised questions over whether Mr Yousaf was avoiding paying the higher rates of income tax his government introduced. The firm is subject to only 19 per cent UK corporation tax on any profits below £250,000.
As First Minister, Mr Yousaf argued that there was a “social contract” between his government and the Scottish people, whereby they paid higher rates of tax in return for benefits not available elsewhere in the UK such as free prescriptions.
His government increased the top rate of income tax in Scotland, payable on earnings over £125,140, to 48p – 3p more in the rest of the UK. It also created a sixth income tax rate, charged at 45p, on income between £75,001 and £125,140.
Sources close to Mr Yousaf, who stood down as first minister in May this year, said in response to reports on the setting up of the company that any future income derived from the company would be taxed in the usual way.
However, the Chartered Institute of Taxation has said that any money withdrawn through dividends would not be charged at Scottish income tax rates.
Instead, the money would be taxed at UK dividend rates of between 8.75% and 39.35% , depending on his income tax band, and he would avoid having to pay National Insurance.
Mr Yousaf’s spokesman said earlier this month: “The company set up by Humza Yousaf, and his wife Nadia, is for activity undertaken outwith their respective roles as elected members.”
A source said the company would “help to support causes both Humza and Nadia are passionate about”.
They have both been persistent critics of the UK Government’s approach to the Gaza crisis.
Ms Sturgeon’s allies have said that any payments made by her company to her would be taxed on income in the normal way. However, none had been made so far.
The Herald asked the SNP for a comment on Mr Ewing’s remarks.
