Scottish industry groups call for business rate rise change

Four of Scotland’s leading industry groups have united to challenge the Scottish Government to ensure future increases in business rates rise by no more than CPI, rather than the RPI measure of inflation.

A switch from RPI to CPI indexation was endorsed by the recent Barclay Rates Review and – following last week’s UK Budget – is also being introduced for ratepayers in England from next Spring.

Scottish Engineering, Scottish Property Federation, Scottish Retail Consortium and the Scottish Tourism Alliance have called for a similar move to be made in Scotland ahead of the Scottish Government’s Budget which is expected on December 14.

Scotland has historically maintained a level playing field with England on the headline business rate poundage.

The group states that keeping future rises in Scottish business rates aligned with RPI rather than CPI would put Scottish businesses at a competitive disadvantage compared to firms operating down south, by approximately £25-30 million next year.

Bryan Buchan, chief executive of Scottish Engineering, said: “Given current concerns over forecasted low economic growth and our relatively poor performance in terms of productivity, the Government should be doing all it can to stimulate business.

“Adoption of CPI as the basis of business rates increase calculations would be of assistance and a helpful step forward to achieving a refreshed rates system that offers a real stimulus to new and growing businesses.”

David Melhuish, director of the Scottish Property Federation, said: “The Scottish Budget offers the Government an opportunity to set a sustainable path to supporting business and taking forward the Barclay review of business rates.”