TAX GRAB REBELLION GROWS
Angry business leaders join forces to fight for a freeze on rates hikes
HUNDREDS of companies have joined together in a major rebellion against soaring Scottish business rates.
SNP ministers are facing a growing backlash over the increases that threaten to cripple shops, nurseries, hotels and pubs throughout the country.
At a meeting on Wednesday, Finance Secretary Derek Mackay and Economy Secretary Keith Brown will face an alliance of angry business leaders representing hundreds of firms.
It will urge them to freeze plans which will see some companies face a rise of up to 620 per cent in their rates.
This follows the first revaluation of non- domestic property since 2010, which is set to i mpact thousands of businesses across Scotland.
Business leaders have repeatedly called for the Scottish Government to offer support to those worst hit.
However, the alliance – which has started to hold meetings with members – said it feels that the Scottish Government is ‘ hearing but not listening’.
So far Mr Mackay has refused to provide any words of comfort and instead insisted that local authorities could help with financial relief to those facing a rates hike.
This is despite fears that some businesses could be forced to cut staff, raise prices or even close if changes are not made.
Experts have expressed concern over the impact this could have on the Scottish economy.
The alliance includes the British Hospitality Association, the Scottish Tourism Association and Glasgow Chamber of Commerce.
The group will tell Mr Mackay that he must halt plans which will see business rates rise in April until the business rates review – which is being carried out by former RBS chairman Ken Barclay – is published in July, or until f i rms have a decision on appeals.
Businesses will be able to lodge appeals against rate increases from April. However, experts predict that it could take up to three years before a decision is made due to the volume expected. During the appeal process firms must pay the new rate.
Speaking yesterday Willie MacLeod, executive director of the British Hos- pitality Association in Scotland, said he is not hopeful about the outcome of the meeting.
He said: ‘We want to impress upon them the seriousness of this issue. This is not just a reaction to the increase of business rates, this is a serious issue for businesses, we are not just scaremongering.
‘We are really concerned about the sustainability of businesses and the economy. A lot of businesses may not be able to survive this and may have to lay staff off.
‘We know the Barclay Review is due in the summer and that this cannot do anything with the revaluation. So we are asking the government to put a hold on the increase until we see what comes out of the review, and then reassess then.’
But he added: ‘I’m afraid from what I’ve seen I am not hopeful.
‘We have been seeking this meeting since the end of October. I think they are hearing us but they are not listening.
‘We are going into the meeting and we hope they listen to us and agree to do something – at the very least putting a stay on the increase.’
Following the meeting, the organisations will discuss the outcome and what actions to take next.
There has been talk of firms boycotting rates but many business owners say they fear this may lead to the Government taking l egal action against them – putting them at further risk. Donald MacLeod, who owns The Garage nightclub in Glasgow, attended a meeting of business leaders and bosses last week.
He said the rise in rates has ‘galvanised’ business chiefs and that pressure was mounting on the Scottish Government. He faces a £100,000 rise in his business rates.
‘The pressure certainly is there,’ said Mr MacLeod. ‘We are asking for a freeze, not a transitional period – that would be accepting that this is going to happen.’
Regarding the upcoming meeting, he said: ‘We are not hopeful. They are quite argumentative and don’t seem to be for turning.
‘We want to see change, and if there is not then they have trouble ahead.’
Last night, Scottish Conservative finance spokesman Murdo Fraser said the SNP must stop passing the buck and deal with the problem.
‘It’s no wonder business are appealing to Derek Mackay in this way,’ he said. ‘ Many of these face going to the wall if these crippling rates rises go ahead.
‘Instead of trying to pass the buck, the SNP should be doing its job and tackling the problem head on.’
While the Confederation of British Industry (CBI) Scotland will not be attending the meeting at Holyrood this week, director Hugh Aitkin said last night it was ‘ unfortunate’ that the change to rates had not been timed to take in the Barclay review results.
He said: ‘ All companies are struggling with the increasing burden from business rates, which are hampering efforts to create jobs and growth.
‘For many businesses across Scotland increases in rates are simply unsustainable which is why it is unfortunate that changes haven’t been implemented in tandem with Ken Barclay’s system-wide review this summer.
‘We would recommend that the Scottish Government looks closely at how it can fast-track rates reform in the near term.’
This week Green MSP Andy Wightman will move a motion to annul the Non-domestic rate (Scotland) Order 2017 and prompt a debate at Holyrood’s local government committee about the lack of scrutiny on how the increases are applied.
A Scottish Government spokesman said: ‘As part of the scrutiny process f or every Budget the Scottish Government provides all requested information to parliament.
‘However, the way in which the process itself is managed is a matter for the Scottish parliament.’
‘Businesses may not survive’
AS Scotland’s Finance Minister, he has lurched from crisis to crisis since he was unexpectedly handed the job last year.
And, fresh from his much criticised (and costly) deal with the Green Party to get his budget approved, Derek Mackay now looks desperately out of his depth on the issue of planned business rate increases.
In recent days, opposition to the planned new charges has reached critical mass. Small businesses across Scotland – which have already warned they could face closure if landed with rates bills of up to five times their current level – have been joined in voicing concerns about the new charging regime by such industry bodies as the Scottish Tourism Association and the Scottish Licensed Trade Association.
Even former First Minister Alex Salmond has spoken out to say that some opposition to the new rates levels is justified.
As the rates juggernaut thunders on, Mr Mackay stands, caught in its headlights. His inability to react to the legitimate concerns of entrepreneurs suggests a total lack of confidence on his part.
The business community and opposition politicians have presented an utterly compelling case for the planned increases to be halted. While small businesses, many of them already struggling to stay afloat, will face huge new bills, many l arge organisations – such as Amazon – will see their business rates fall. Even the Scottish parliament’s bills are set to drop.
If the SNP is serious about stimulating growth in Scotland’s underperforming economy, it should be bringing forward policies that help small and medium sized companies. Instead ministers are prepared to let businesses fail during this shortsighted cash-grab.
If Derek Mackay doesn’t feel he has the authority to call a halt to these new rises, Nicola Sturgeon must pull rank and do so. Otherwise, the SNP will stand guilty of sacrificing Scottish companies on an altar of destructive pig-headedness.