Scottish Budget

Plea to Forbes as 20,000 firms lost in Covid crisis

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Many firms shut up shop

Finance Secretary Kate Forbes has been urged to provide continued support after new data showed Scotland lost almost 20,000 small businesses in the first 12 months of the Covid crisis.

The number of registered firms between March 2020 and March 2021 fell by 19,805, a drop of 5.4%. There are now 344,505 enterprises in Scotland, the smallest number since 2014 when there were 329,765 businesses.

Most of the fall are not registered for VAT and/or PAYE – accounting for 19,015 of the total.

The Federation of Small Businesses said that this trend implies that the crisis has been particularly difficult for the self-employed and new start businesses.

Andrew McRae, FSB’s Scotland policy chairman, said: “The stories behind these figures will all be different. But they’ll include the tour guide who had to get a job as he couldn’t run the business he loved while there were no tourists. Or the migrant business owner who decided to return to their country of origin during the crisis and then never came back. And the person who ran the local café, but couldn’t make it turn a profit when faced with restrictions.

“While the public health measures that were taken were necessary, there’s no doubt that they took a huge toll on local firms and the self-employed. That’s why we believe that policymakers have a duty to help these operators recover from the crisis.” 

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