Opposition to bill change
More trade groups join campaign against rates plan
Andy Wightman’s proposal has drawn criticism (pic: Terry Murden)
UPDATED 6 DEC: The Scottish Licensed Trade Association (SLTA) has added its voice to six other organisations opposed to a proposal to fragment the business rates system.
Opposition MSPs have voted for an amendment to the Non-Domestic Rates Bill proposed by Andy Wightman of the Green Party that would remove the ability of Scottish Ministers to set the business rates poundage and hand greater powers to local councils.
The SLTA said it is in “complete disbelief at the totally ill-conceived ideology and reckless actions of the Conservative, Labour and Green parties to drag business back 25 years by scrapping the current uniform business rate (UBR) system.”
It is the latest trade group to express concern. The Scottish Grocers Federation, Association of Convenience Stores, the Scottish Beer & Pub Association and the Scottish Tourism Alliance offered support to three trade groups – the Federation of Small Businesses Scotland, the Scottish Retail Consortium and UKHospitality – who met Finance Secretary Derek Mackay in Stirling on Wednesday to discuss their concerns.
The SLTA said that while the current system has major problems, particularly for the licensed hospitality trade, progress was being made. However, it suggests that this latest development will raise grave concerns for all Scottish businesses.
The SLTA points out that already a large proportion of Scottish businesses are disadvantaged compared with other areas of the UK and this will only add to the problem and bring more uncertainty, increased costs for businesses and a lack of further investment.
SLTA is deeply concerned that if this change is brought in and the rating system is overseen by 32 unitary local authority councils, the outcome across the country will be disastrous for all businesses, and the problems of inconsistencies of approach and vagaries already experienced by the licensed trade will be exacerbated.
The SLTA, UK Hospitality, and the Scottish Tourism Alliance, recently met with Kate Forbes, Minister for Public Finance and Digital Economy, to discuss alternatives for the current system. Following this recent development, the SLTA will be meeting with Ms Forbes again,” sooner than planned.”
SLTA managing director Colin Wilkinson said: “We understand that the Parliament’s Local Government Committee may take the unusual step of holding a further hearing on the matter of ending the uniform business rate and instead handing control over the setting of the poundage rate, reliefs and any local supplements/levies to local authorities.
“The Committee may also be open to receiving short written submissions on this matter from industry. The SLTA would encourage all businesses to make use of this opportunity, but time is short as it looks like December 20 would be the deadline.
The Scottish Government has criticised the move as ‘reckless’, claiming it will ‘devastate’ businesses
The Tourism Alliance said it “echoes the concerns of our counterparts over the impacts of the proposed changes which will create added costs, deter investment and place thousands of small businesses under threat.”
Earlier, the three business group issued a joint statement following their meeting with Mr Mackay. It said: “The meeting with the Finance Secretary was a useful opportunity to highlight our profound concerns after last week’s vote in Parliament to scrap the uniform business rate.
“Taking business rates out of the hands of ministers and handing control over this £2.8 billion tax to councils places a big question mark over existing Scotland-wide rates reliefs, such as the Small Business Bonus scheme.
“Firms fear this move could lead to higher business rates bills for both large and small organisations, at a time when the poundage rate is at a 20-year high. It remains unclear too what this change would mean for the finances of rural and less well-off local authorities and therefore ultimately for rates bills in these areas.
“The lack of any impact assessment to accompany this fundamental change in rates policy and what it will mean for ratepayers, for existing reliefs, and for councils themselves, is troubling. MSPs must revisit this amendment to the law at the earliest opportunity.”