LIZ CAMERON
The Scottish electorate has spoken once again and this week our new MSPs will be settling into their responsibilities in the Scottish Parliament. Their collective priority must now be to focus on the Scottish economy, put business first and get back to helping firms across Scotland to succeed, grow and create jobs.
One of the first tasks of the new Scottish Government will be to get its promised review of business rates underway. Expectation amongst the business community is high. After a false dawn in 2012, when the Scottish Government promised a review but failed to deliver, this latest review must bring real and lasting change for the better. It must be done swiftly – business cannot wait.
For too long, business rates have been treated as a cash cow by successive governments. Even since the time of the last rates revaluation in 2010, revenues have increased from less than £2.1 billion a year to £2.8 billion a year, a rise of over a third. In that time, the Government has also sought to top up revenues through its ‘Public Health Levy’ which applied a surcharge to large retail businesses and, most recently, its doubling of the ‘large business supplement’. Contrary to what some people might think, this is not a supplement which just affects big corporates – in fact, it is hitting almost 29,000 businesses across Scotland, including many independent High Street shops, for example. It is time that Government stopped ratcheting up this tax year upon year and eased the burden on business. In addition, changes made this year to the availability of rates relief on empty properties have landed many business with big unplanned bills. Whilst welcoming the Government’s renewed commitment to the Small Business Bonus scheme it only eases the overall tax take by a little over 6%.
Then there is the fact that this tax is levied on valuations that are already two years out of date. That is why the last revaluation completely ignored the effect of the last recession on businesses and why businesses in the north east of Scotland are already getting nervous about next year’s rating revaluation, which will be based on valuations in April 2015 before the worst effects of the oil price collapse really began to take hold.
Cutting the burden of business rates would deliver a real boost to Scottish businesses as we plan our way towards recovery and growth. This must be a clear priority for all of the parties in the new Scottish Parliament.
Liz Cameron is chief executive of Scottish Chambers of Commerce
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