FINANCE Secretary Derek Mackay has managed to get his Budget through Parliament after reaching a deal with the Greens.
The Budget passed by 67 votes to 58 with one abstention.
As part of the deal, the Scottish Government will bring forward legislation that will allow local councils in Scotland to introduce a tourist tax on hotel stays.
Local government funding had been a key feature in the Greens' demands, with intense negotiations taking place between the two parties over the last 48 hours.
Mackay tweeted: "Pleased to have reached agreement with the Scottish Green Party to deliver a Scottish Budget that invests in health, education, our economy and supports local services."
Harvie said: "Finally, after months of hard work and Green pressure for local tax reform and protection of local services, we have reached a budget agreement.
The SNP minority Government in Edinburgh needs to win the support of at least one of the other parties for legislation to be approved.
This is the third year in a row Mackay has made an agreement with the six Scottish Green MSPs to ensure support for his Budget proposals.
As well as announcing ministers will legislate to allow councils to bring in a transient visitor levy, the Finance Secretary pledged an additional £90 million of funding for local government.
Ministers will also back changes to legislation currently going through Holyrood that could allow local authorities to bring in a workplace parking levy – although hospitals and other NHS properties would be exempt.
Scottish Budget LIVE: Greens and SNP reach a deal ahead of Budget vote
Council funding settlements will in future be made on a three-year basis, with this taking place from 2020-21 onwards.
Mackay further promised to hold cross-party talks on a replacement for the current council tax system and said if agreement can be reached on the issue, legislation could be published before the end of this Holyrood term in 2021.
This could then be taken forward after the 2021 Scottish Parliament election.
Mackay said: "The Scottish Budget proposes an additional £2 billion of investment. It provides an increase of almost £730m for health and care services, more than £180m to raise attainment in our schools, and gives a vital boost to our economy through a £5bn infrastructure programme.
"As a result of these decisions, we have been able to invest in essential public services, particularly the NHS, while ensuring 55% of income taxpayers in Scotland pay less tax than those earning the same income in the rest of the UK.
"The Scottish Government has continued to ensure our partners in local government receive a fair funding settlement despite further cuts to the Scottish budget from the UK Government.
"These additional measures will deliver the most significant empowerment of local authorities since devolution and provide additional funding to support local services.
"This enhanced package offers up to £187m of increased funding and flexibility to councils, on top of the £11.1bn local government settlement.
"In total, overall spending power for local authorities next year will be £620m higher than it is currently."
Local government will also be allowed to raise council tax by 3% in real terms – which equates to a maximum increase of 4.79%.
Harvie said: "Scotland has a centralised, constrained and under-powered system of local government and that needs to change.
"The package of local tax reform measures we've seen announced today will make real progress.
"We have for the first time a clear, definitive timescale for publishing legislation to abolish and replace council tax during this session of Parliament."
He condemned the other parties for failing to take part in the Budget process, after both the Conservatives and the LibDems demanded the SNP ditch any prospect of a second independence referendum before May 2021 as their key condition.
READ MORE: Labour's Alex Rowley squirms as Budget talk leaves Leonard red-faced
The Green MSP said: "Others seem to think that engineering a crisis would be the best outcome instead of achieving changes that work for the country.
"It's as though some people look at the US government shutdown or the shambolic incompetence at Westminster and think they should do the same here.
"Chaos for the sake of chaos is not what Scotland needs."
Scottish Conservative finance spokesman Murdo Fraser said his party had offered to talk to the SNP, but claimed the Government would "rather talk to the anti-growth, anti-business Greens".
As a result, he claimed: "Instead of reducing the tax burden, they're going to put it up.
"And the consequence will be the Scottish economy will continue to under-perform and will have yet more taxes for hard working families. That is not a direction that we can support."
Labour's James Kelly also made his party's opposition to the plans clear.
"Labour will never sign up to a Budget that's got cuts to local council services in it," he said.
"This is an unfair budget based on unfair taxation when it awards tax cuts up to everyone earning £124,000.
"So if you're a chief executive or a managing director or a cabinet secretary, then you're cheering this Budget on tonight because it's going to give you a tax cut.
"But if you're a commuter on a platform waiting for a delayed or cancelled train, not able to get to your work or a hospital appointment, you won't be cheering this Budget on."
Scottish LibDems leader Willie Rennie criticised the Greens, who he said had once again "ridden to the rescue of the SNP".
He said: "The Greens have been bought cheaply, the extra money for councils was already available. Local government finance reform has been delayed until the next Parliament, bogged down, once again, in another commission.
"Patrick Harvie has settled for the vice-convenership of the car parking working group."
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