Scotland Act 2012 given Royal Assent
Scotland is to be handed new powers in setting its own rate of taxes and legislation after the Scotland Bill was given Royal Assent.
The new legislation between Westminister and Holyrood - known as the Scotland Act 2012 - will also allow Scotland to borrow money, within Treasury limits.
Prime Minister David Cameron reportedly described the Act as "a historic day for Scotland", according to the BBC.
As well as giving potential for a new Scottish rate of income tax, the Act is expected to initiate the devolution of stamp duty land tax and landfill tax. Scotland will also be able to decide its own legislation over air-guns, drink driving and national speed limits, and decide on new procedures regarding Scottish criminal cases that go to the UK Supreme Court.
The former Scotland Bill has now completed its parliamentary stages to become an official Act of Parliament or law, although Scotland will not be able to implement the news powers until April 2016.
According to the BBC, David Cameron, said: "We made a very clear promise that we would go ahead with this Bill, which is the biggest act of fiscal devolution in Scotland's history, to give the Scottish Parliament far more responsibility to raise the money that it spends, and we have delivered on that promise.
"So this is a great day for Scotland, a great day for the Scottish Parliament and a day when the Government can put its hand on its heart and say we promised something and we delivered it."
However, commenting on the Bill last week, Scottish Nationalist Party (SNP) spokesperson Steward Hosie, said the bill was a 'job half done.'
"The Bill is a missed opportunity to deliver the real job-creating powers that people in Scotland need and want," he said.
It is speculated that HMRC will determine a Scottish tax payer based on an individual's main place of residence.
There is also speculation on how income tax in Scotland will be calculated and administered, with some suggestions it will be paid through employers deducting tax via PAYE, with rates either higher or lower than those in the rest of the UK.
The act is currently being prepared for publication.