Business backlash as rate relief is cut short

Anger after aid package fails to match up to that in England

STRUGGLING businesses are facing a rates relief cliff-edge after Kate Forbes ‘delayed’ a massive financial blow for companies by three months.

The Finance Secretary yesterday extended the 50 per cent business rates relief as she unveiled her draft Scottish Budget for 2022-23.

The 50 per cent cut for retail, hospitality and leisure businesses will continue for the first three months of the next financial year, while small businesses will pay nothing.

Business leaders said the short extension ‘sends a stark message’ that government

‘Could spell end for many businesses’

support was being scaled down. The pledge fails to match that made by chancellor Rishi Sunak in England, where the 50 per cent rates relief will remain in place for the entire financial year.

Scottish Hospitality Group spokesman Stephen Montgomery said: ‘The business rates relief announced today may be helpful for a short period for some hospitality businesses.

‘But the cap [£27,500 per ratepayer] cripples many, and the significant cost challenges for hospitality will not end by summer next year. The removal of rates relief next year could spell the end for many hospitality businesses.’

At Holyrood, Miss Forbes said the Scottish Government had offered 100 per cent rates relief for retail, hospitality, leisure and aviation in the last two years of the pandemic, adding: ‘We were also the first government to offer the certainty of a relief in 2021-22 when businesses needed it most.’ Miss Forbes claimed she had offered ‘the most generous rates relief in the UK’ during the pandemic.

She added: ‘Rates relief for the retail, hospitality and leisure sectors will continue at 50 per cent for the first three months of 202223, capped at £27,500 per ratepayer. This will prevent a cliff-edge for businesses in those sectors, saving them a further £56million.’

Marc Crothall of the Scottish Tourism Alliance said the announcement sends ‘a clear and stark message to Scotland’s tourism industry that the short-term extension of business rates relief is the one last lifeline of support’.

Tracy Black, director of CBI Scotland, said: ‘Many will be disappointed that the government hasn’t gone further – particularly as uncertainty around Omicron gathers pace.’ The Scottish Licensed Trade Association said more was needed to give companies a ‘fighting chance’ as they recover from coronavirus.