Report warns rates relief cap not all it seems

Businesses in the northeast expecting to benefit from a 12.5% rates cap could still face actual increases in bills of up to 33%, according to new analysis.

The Scottish Government introduced special measures earlier this year to help companies in the hospitality sector as well as office buildings in Aberdeen and Aberdeenshire affected by the 2017 rates revaluation.

In his budget yesterday, Finance Secretary Derek Mackay confirmed that the 12.5% relief cap in non-domestic rates (NDR) bills would continue for the 2018-19 financial year.

But the Scottish Fiscal Commission (SFC) has said that the additional burden could be more than double that figure.

In its report, the SFC said that companies “will pay no more” than a 33% increase on their 2016-17 bill – a compound of two 12.5% caps with added inflation.

Mr Mackay also confirmed that the poundage rate for calculating business rates will go up from 46.6p to 48p in the pound.

Graham Mogford, an Aberdeen nursery owner who bitterly criticised a 78% hike in his rates bill, cautiously welcomed the potential of a rates exemption for his sector.

He added: “We are obviously happy about the news but I will wait until April when I see it in black and white before celebrating too hard.”

George Alexander