Rate hike firms to face delay in help with bills

BUSINESSES could be forced to pay rates rises of up to 300 per cent before claiming the money back – despite an SNP pledge to ‘cap’ increases.

The Scottish Government was heavily criticised after the revelation thousands of firms would face soaring business rates after the first revaluation of non-domestic property in seven years.

Pubs, restaurants, hotels, nurseries, tourist attractions, shops and cafes were among those facing rises of up to 300 per cent.

Finance Secretary Derek Mackay eventually told Holyrood that the Government would offer support to almost 8,500 hotels, pubs, restaurants and cafes – with a cap on any increase at 12.5 per cent.

But he has confirmed the limit will only apply for ‘the current financial year’ – meaning firms still face the threat of larger rises.

The announcement over the ‘cap’ was made in February but many councils are still said to be unsure of how the changes will be implemented. Now firms have learned that the system will be ‘application based’ and they could be forced to pay the higher rate before being reimbursed.

Ryan James, owner of Two Fat Ladies restaurant in Glasgow, said: ‘This is just a joke.’

He added: ‘When you consider the size of increases being faced by businesses, to shell this out and then wait to get some of it back will make a huge dent in cash flow.’

Scottish Tory finance spokesman Murdo Fraser said: ‘Even the limited relief announced by Derek Mackay looks like it is in trouble, with councils unsure of how to apply it and businesses having to do most of the leg work themselves.

‘It’s yet more evidence of how much trouble this SNP Government is in when it comes to the economy.’

A Scottish Government spokesman said: ‘The business rates cap announced for hotels, pubs, restaurants and other accommodation must be an application-based scheme to comply with European Union state aid rules and to ensure eligibility for relief.

‘It is up to individual councils to administer the relief.’

‘It will make a huge dent in cash flow’