SCOTLAND will not have control over all of its taxation after Labour and the Tories joined together to vote down proposals for Full Fiscal Autonomy (FFA).

Two amendments that would have seen the powers over raising and spending taxes devolved to Holyrood were roundly defeated in Parliament yesterday.

During a heated session in the House of Commons, David Mundell even started to distance his party from “The Vow” made by the three unionists parties just before the referendum on independence by claiming that it did not promise Home Rule and that it had no impact on how people voted.

It was the first of four days of debate on the clauses of the Scottish Parliament – the dates of the other three will be revealed later.

MPs debated clauses on FFA tabled by the SNP and by the Tory backbencher Sir Edward Leigh.

Proposing his amendment, Sir Edward said that the Smith Commission was a “rapid- scissors-and-tape job in response to a vow that was hastily put together by panicked unionist politicians in the last days of the referendum campaign.”

Sir Edward continued: “If it were voted for tonight it would establish a clear principle and a way forward. The contention is clear – the new clause delivers full fiscal autonomy.

“The Scottish Parliament would have full freedom to raise all taxes as it like, not just fiddling around with bands but all thresholds, all VAT dividends, and it would have full freedom to spend this as it likes – that’s what real parliaments do, that’s why they are responsible.”

While the SNP amendment was very much on their terms, Sir Edward’s amendment would see FFA delivered almost immediately.

In what was clearly a surprise to the Labour and Tory front benches, SNP Treasury spokesman Stewart Hosie confirmed that his party would vote for Sir Edward’s amendment.

Hosie told the Commons: “If we can agree this tonight, if we can agree full fiscal autonomy and the Scottish Government’s ability to draw down the powers at the right time, then we can get the agreement, the fiscal agreement, on the overarching framework and we can all get to work.”

Responding to a question from Labour’s Ian Murray, Hosie said: “I want maximum power for Scotland. I want it as quickly as possible. I’m not like the British Labour Party who keep saying no and in the absence of no say ‘delay with yet another commission.’”

He added: “It’s not simply about responsibility for taxation, it’s about responsibility for all spending outwith limited and agreed areas.

“We need and we deserve the bulk of decisions to be taken as close to the people as possible and more importantly we need these decisions to be taken in line with the aspirations and democratic choices of the Scottish people.

“We believe in the transfer of more power to Scotland not as an end in itself, but because the Scottish Government can exercise those powers to the benefit of Scotland’s economy and society.”

During his summation Labour’s Murray said that had it not been for Edward Leigh, the SNP would likely not have tabled any amendment asking for FFA, an accusation Hosie dismissed as a “daft allegation”.

Murray said: “Let me be clear that we will not support these two amendments – they are not in the interest of the Scottish people.”

Away from the debate on the Scottish Parliament raising and spending taxes, there were also amendments on the permanence of the Scottish Parliament, putting the Sewel convention – whereby Westminster must seek permission from Holyrood before legislating on devolved matters – on a statutory footing.

Both were key recommendations of the cross-party Scottish Parliament’s Devolution (Further Powers) Committee.

Carmichael, who found himself sitting on the opposition benches surrounded by SNP MPs, said that there was clearly a “broad consensus” between Liberal Democrats, Labour and SNP MPs that the Scotland Bill could be improved.

Despite that broad consensus, voting together for the permanence of the Scottish Parliament to be enshrined, the SNP amendment was defeated 271 to 302.

Earlier in the day, Deputy First Minister John Swinney had written to Scottish Secretary of State David Mundell outlining the additional powers the Scottish Government would like to see devolved to Holyrood.

The SNP want the power to change Scotland’s corporation tax, capital gains tax, the minimum wage, benefits relating to children and National Insurance to be in the hands of MSPs.

Swinney also asked for Holyrood to be in charge of employment policy and law, jobcentres, and laws on trade unions and health and safety.

Swinney said: “As a minimum, the Scotland Bill must deliver the spirit and letter of the Smith Agreement in full and we will continue to hold the UK Government account to ensure that happens.

“However, we have always said that the recommendations did not go far enough and fall short of a coherent package of powers to help us grow the economy and lift people out of poverty.”

Swinney continued: “We have consulted a range of stakeholders in preparing these priorities, and will continue to engage widely.

“I have already heard real concerns about the coherence of the measures that the Scotland Bill currently delivers. We will now be pressing the UK Government for substantial and serious discussions on these proposals, in line with the commitment made by the Prime Minister to the First Minister in May.”