Retail leaders claim budget piles on costs

The impact of Scotland’s budget on retailers is a “recipe for selfinflicted economic harm”, industry leaders say.

The Scottish Retail Consortium (SRC) has published a detailed response to a “muddled” budget for 2024-25.

David Lonsdale, SRC director, said it was particularly disappointing given the “low ebb” of retail sales in recent years.

The consortium had criticised ministers for failing to plug an estimated £1 billion deficit by cutting government costs as civil service numbers expand.

The SRC has argued the buck is being passed to retailers as the freeze to the basic property rate falls to medium and larger commercial properties.

Deputy First Minister Shona Robison announced the poundage on the basic property rate would be frozen for businesses with a value up to £51,000.

The SRC estimates 22,120 commercial premises – including 4,550 retailers – will have to pay much more, a 6.7% rise.

“It puts added pressure on those retailers striving to trade profitably and pushes up the cost investments which stores up problems for the future,” the analysis said.

“An uplift of this magnitude is at odds with the Scottish Government’s pledge to ‘use business rates to boost business’. It could undermine efforts at high street and town centre rejuvenation.”

The SRC also raised alarm that retailers will fear future “cash grabs” in the coming years.

The report brands the proposals a “recipe for selfinflicted economic harm”.

Mr Lonsdale said the “oblique, unclear and not-consulted-upon threat” would be a “retrograde step” at odds with the New Deal for Business.

He said: “Grocers, who already face expensive regulatory interventions on alcohol, high fat, salt and sugar (HFSS) foods and the troubled deposit return scheme, now face an additional tax – which even the Scottish Government admits is nothing more than a cash grab.

“The combination of new taxes, increasing business rates, and cuts to skills funding makes it hard to discern a coherent plan to grow the Scottish economy in this muddled budget. Scotland’s economy isn’t in great shape and the budget seems set to make things more challenging.”

Liz Smith, Scottish

Conservative finance spokeswoman, said: “It’s no wonder the SRC are concerned by this disastrous budget, which might have been designed to stymie growth and hammer retail businesses.

“The SNP’s constant imposition of more costs and regulations, rather than addressing their own over-spending and mismanagement, makes a nonsense of their claims to be listening to business.”

The government has been asked to comment.

BIGGER BILLS: Conservative Liz Smith, the SRC’s David Lonsdale and Shona Robison.