Payday lenders will be barred from a scheme which reduces the amount of rates paid by businesses.

Finance Secretary John Swinney made the announcement as MSPs backed his annual financial package for local government.

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It confirms a suggestion made last month by local government minister Derek Mackay, who is calling a summit to discuss how to limit payday lending and gambling shops on Scotland's high streets.

Mr Swinney said: "I can announce today that legislation has been laid to ensure that from April 1, payday lenders will no longer be eligible for business rate relief."

Labour MSP Kezia Dugdale, who has called for a crackdown on payday lenders through her Debtbusters campaign, welcomed the move.

"It's fantastic news, long overdue," she said. "I've been asking the Government to use the powers it has to tackle this for over 18 months.

"I'm also calling for extra help through the planning system to give people a say what happens on their high streets."

Mr Swinney's local government finance order also confirms spending for councils worth more than £10.6 billion in 2014-15.

He outlined its aims one day after Parliament backed his commitment to mitigate the impact of the so-called bedroom tax on tenants in Scotland.

The order confirms £37.9 million for a welfare fund in the year ahead.

"By working constructively with our local government partners we have agreed an overall funding settlement and package of measures to help maintain and evolve the services on which the businesses of Scotland and the people of Scotland depend," he said.

Labour MSP Sarah Boyack said her party warmly welcomed the cross-party approach to tackle the "bedroom tax".

But she is concerned that the SNP's wider approach to finance has hurt local government.

The council tax freeze is underfunded and public sector jobs have been cut, she said.

"There are good things being done but it's against the tough budget settlement that our councils will face," she said.

"Councils want to do more, they're ambitious to do more but they need the ability to do that, and this Scottish Government is not doing enough to help them."

Labour agreed to back the order "with a heavy heart", she said.

Conservative MSP Cameron Buchanan said his party backs the order despite rejecting the overall Scottish Government budget.

Liberal Democrat leader Willie Rennie welcomed extra money for free school meals and nursery education.

"It was something we argued for pre-Christmas and we were delighted to see it is now being implemented," he said.