Minister eases worries over rates

Mackay: ‘I have no plan to impose out of town levy’

Derek Mackay at Spaces 1

Derek Mackay: aware of concerns (pic: Terry Murden)


Finance Secretary Derek Mackay said he has “no plan” to introduce a controversial business rates levy on ‘out of town’ businesses.

Mr Mackay told Daily Business that it is “being considered” but does not form part of his business tax plans.

More than 30 trade organisations have expressed concern over giving local authorities the option of imposing an additional tax.

The levy was among the recommendations in Ken Barclay’s review of business rates published at the turn of the year and has proved one of the more contentious.

Lobby groups including the CBI, Scottish Retail Consortium and the Chartered Institute of Taxation have urged Mr Mackay to reject the proposal, calling it “difficult to implement” and a “bureaucratic burden”.

Mr Mackay, speaking after unveiling his Economic Action Plan, stressed that it was “still being considered by the implementation group” and therefore had not been rejected. However, he was aware of the level of opposition to the idea.

“I have no plan to introduce it,” he said.

Mr Mackay unveiled an £18 million advanced manufacturing challenge fund as part of his action plan which also includes measures to attract skilled labour post-Brexit, and the launch of two pilot Productivity Clubs to help businesses help each other.

Most of the measures unveiled had already been announced, including investment in City Deal, the creation of a South of Scotland Enterprise agency and establishing the Fair Work First initiative to encourage gender and pay fairness.

Responding to the Scottish Tories plea to work with them on a pro-business, low tax agenda, Mr Mackay offered qualified support for the idea.

“My door is open to any party to ensure the Budget goes through,” he said.

Referring specifically to the Conservatives’ offer to work with the SNP on cutting air passenger duty, to be replaced in Scotland by air departure tax), he said: “The Tories’ proposition appears to be focused on tax cuts for the richest.”

He said cutting ADT was something the Scottish government was still committed to achieving but a ruling was still required on whether the Highlands and Islands would continue to be exempt.

This requires EU approval under state aid rules and as the UK is the member state Mr Mackay said that resolving the issue rested with the Conservative government in Westminster.

“The UK government could fund the solution,” he said, adding that if the Tories wanted to help the SNP government its 13 Scottish MPs could put pressure on Westminster on this issue.

See also:

Business concerns mounting over local rates levy

Economic action plan launched and grant offered to software pioneer



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