 Scotland's tax and welfare powers are changing. How does this affect the block grant? Scotland receives the majority of its funding in the form of a block grant from Her Majesty's Treasury. Annual changes to the block grant are calculated using the Barnett formula. Scotland has some tax-raising powers, the revenue of which stays in Scotland. These powers cover council tax, business rates, land and buildings transaction tax and landfill tax, worth £4.4 billion in total. Council tax and business rates are collected by local authorities in Scotland. LBTT previously stamped duty land tax and landfill tax were devolved in 2015 through the Scotland Act 2012. They used to be collected by HMRC with receipts going to the Treasury. Now they are collected by Revenue Scotland and money goes to the Scottish Government. All other taxes are collected by HMRC and receipts go to the Treasury. Under the Scotland Act 2012, the Scottish Rate of Income Tax, or SRIT, will be introduced in April 2016. It will be the single biggest devolved tax contributing almost half of the £8.6 billion a year raised by Scottish taxes. More taxes are set to be devolved under the Scotland Bill 2015-16. All of income tax on non-savings, non-dividend income, including the power to vary the rates and bans. Air passenger duty aggregates levy. The Bill also assigns 50% of Scottish VAT receipts to the Scottish Government. The devolution of income tax will replace SRIT. These taxes will raise more than £20 billion in a year. To find out more about Scotland's public finances and even set SRIT yourself, go to scottish.parliament.uk forward slash scottish-government-budget.