Rates relief extension ‘offers only short term lifeline’
Kate Forbes delivering her Budget
Business rates will return for some firms on a phased basis next year as part of a package of measures outlined in Kate Forbes Scottish Budget which drew concern that it will only delay the onset of crippling costs.
The Finance Secretary said that rates relief for the retail, hospitality and leisure sectors will continue at 50%, but only for the first three months of 2022-23, capped at £27,500 per ratepayer.
She said this will “prevent a cliff edge” for businesses in those sectors, saving them a further £56m next year.
Non-domestic rates will be 49.8p in the pound, “delivering a below inflation uplift for the fourth year in a row”.
Small businesses with a rateable value of less than £15,000 on Scottish high streets, will continue to pay no rates for all of next year, irrespective of what sector they are in, through the Small Business Bonus Scheme.
New builds will pay no rates for the first 12 months after occupation, through the Business Growth Accelerator. This is “directly seeking to revitalise our high streets”.
She said that her 100% rates relief during the pandemic has saved businesses in Scotland around £1.6bn through the rates system alone since 1 April 2020.
She announced that there will be no change to income tax rates or Land and buildings transaction tax.
Starter and basic rates of income tax will increase in line with inflation, while higher and top rates will remain frozen at current levels.