Business leaders have urged the Deputy First Minister not to increase their rates bill in next month’s Scottish Budget, with 35 organisations uniting to send an “unequivocal message” to Shona Robison.
The groups said freezing business rates will “help ease the burden” for businesses at “this difficult time”.
They made the plea as the Scottish Chambers of Commerce (SCC) claimed firms “now share the view that Scotland has become a more difficult place to do business than at any point in recent memory”.
SCC chief executive Liz Cameron is one of the business leaders who signed the joint plea to Ms Robison as she prepares to announce the Scottish Government’s tax and spending plans for 2024-25 in the Budget on December 19.
Businesses now share the view that Scotland has become a more difficult place to do business than at any point in recent memory— Liz Cameron, Scottish Chambers of Commerce
In a letter to the Deputy First Minister, who is also the Finance Secretary, the groups argued that freezing business rates will help achieve the “shared objective of delivering more sustainable economic growth”.
The letter was also signed by Sandy Begbie, chief executive of Scottish Financial Enterprise, and CBI Scotland director Tracy Black.
It warns that “after three-and-a-half turbulent years of the pandemic and costs crunch”, trading conditions for businesses “remain challenging”.
The signatories said: “We therefore ask that Scottish ministers prioritise a freeze in the headline business rate poundage – which is already at a 24-year high – in the coming financial year.
“This would aid firms with the costs crunch, help them keep down prices for customers, and support business investment and competitiveness.”
Leaders of groups including the Scottish Retail Consortium, the Scottish Grocers’ Federation, the Scottish Tourism Alliance, the Scotch Whisky Association, the Federation of Independent Retailers Scotland, the Federation of Small Businesses Scotland, the Institute of Directors Scotland, the Scottish Property Federation, UKHospitality Scotland, the Scottish Beer and Pub Association, the Scottish Licensed Trade Association and Homes for Scotland have also put their names to the letter.
David Lonsdale, director of the Scottish Retail Consortium, said the signatories are a “formidable cross-section of representatives of Scottish industry and commerce”.
He added: “We hope Ms Robison will take heed and act in her Budget next month to protect Scottish businesses and jobs.”
Ms Cameron said “businesses continue to face significant challenges in the face of high inflation, high interest rates, increasing economic uncertainty and persistent labour shortages”.
She added: “Concerningly, businesses now share the view that Scotland has become a more difficult place to do business than at any point in recent memory.
“Our most recent economic survey demonstrates the consequences of this trend, with a record number of firms in Scotland reporting a pause in investment.
“Business rates continues to be a significant part of that cost of doing business in Scotland, with the business rate at a 24-year high and a fifth higher than at the start of the year.
“If increased in line with current CPI inflation, this could see ratepayers across Scotland face an extra £205 million on their rates bills from next spring.
“That is why we call upon the Scottish Government to rule out any uplift in the business rate and set out a timetabled plan to lower the business rate permanently to a more financially sustainable level for firms.
A Scottish Government spokesperson said: “Scotland already has the lowest poundage rate in the UK, after freezing it as part of the 2023-24 Budget.
“Any decisions for 2024-25 will be made as part of the Scottish Budget process.
“In the meantime, the Scottish Government will continue to do all it can to support businesses in response to the cost-of-living crisis, including pressing the UK Government for support with high energy bills.
“The New Deal for Business Group, which has wide representation from the business community, also continues to consider issues regarding non domestic rates.”
