SNP backbencher Fergus Ewing has launched a veiled attack on Nicola Sturgeon and Humza Yousaf after it emerged the former First Ministers have created companies to manage the payments they receive for work outside of their MSP roles. 

Mr Yousaf followed Nicola Sturgeon by setting up a company to receive payments for his non-MSP work, prompting questions about whether he will avoid paying the income tax rises his government set.

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 heavily defeated by Labour.

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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 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 mention 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?"

SNP MSP Fergus Ewing (Image: PA) 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."

Scottish Conservative MSP Murdo Fraser also raised the issue of former First Ministers setting up companies to deal with outside earnings.

He had tabled a question in the chamber in the wake of a report last week by the Institute of Fiscal Studies (IFS) which warned income tax increases by the Scottish Government in a series of Budgets may have led to less public revenue being gnerated. He used the findings to caution Ms Robison from further rises in her Budget next month.

"Would the Cabinet Secretary agree with me that any MSP, or even any former First Minister who voted for these crippling and counterproductive tax hikes were higher and who then sets up a private company into which future earnings will be paid potentially as a means of avoiding those higher taxes they voted for, is guilty of the most outrageous hypocrisy? Mr Fraser asked.

Ms Robison declined to comment "on anybody's individual circumstances or position on such matters" as she stated that "more people are coming to live and work in Scotland, including those who are higher earners".

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 % 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. 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.

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”.

Ms Sturgeon’s allies have said that any payments made by her company to her would be taxed on income in the normal way.

The Herald asked the SNP for a comment on Mr Ewing's remarks.

During the exchanges at Holyrood, Mr Fraser said the IFS report should be a "wake up call" to the SNP.

The IFS warned changes already imposed may have “slightly reduced” revenues for Holyrood as it called for ministers to “at least pause” any plans to increase income taxes for higher earners in Scotland in next month’s Budget.

The think tank stressed there is a “significant degree of uncertainty about the scale of effects”, but said two studies by HMRC suggest “previous increases in Scotland’s top rate of income tax will have slightly reduced revenues rather than slightly increased them”.

Ms Robison said: “The IFS were clear that they did not have any definitive evidence of any suggested reduction of revenue raised from the highest earners in Scotland in recent years.”

Mr Fraser said: “I would just quote directly from David Phillips of the Institute of Fiscal Studies, who said: ‘Increases of the top rate of tax are unlikely to raise much with evidence from the first of Scotland’s reforms in 2018/19 suggesting they may even reduce revenue.’

“Those are his words, not mine.

“These warnings from the Institute of Fiscal Studies should be a wake-up call to the SNP. For years, we warned that continually increasing tax on the highest earners will be counterproductive.

“The same message has come from Scottish business and now we hear from the respected and independent Institute of Fiscal Studies.

“So will the Scottish Government finally listen to all these warnings, put economic growth first in its forthcoming budget and commit to reducing the tax burden on hardworking Scottish families rather than further increasing it?”

Ms Robison replied: “Let me repeat, the IFS are clear that the uncertainties associated with the behavioural impact of our tax policy are very high indeed.”

She added: “From the introduction of Scottish income tax in 2017/18 more taxpayers have come to Scotland than have left, with net inflows averaging almost 4,200 per year, and more high earning taxpayers came to Scotland than left in 2021/22, the latest year for which we have data.”