DCSIMG

Firms back bid to bring forward review of rates

  • by KRISTY DORSEY
 

SCOTTISH companies are throwing their weight behind a campaign to force finance secretary John Swinney into a U-turn over his controversial decision to delay a pivotal revaluation of business taxes.

Several firms and business groups have already backed a Scottish Parliament petition which seeks to overturn a two-year delay to the revaluations that determine the level of non-domestic rates paid by businesses.

The appeal, which is currently being reviewed by Holyrood’s public petitions committee, is expected to go live within the next week.

The drive is being spearheaded by property firm Colliers International, with the group’s head of rating in Scotland, Peter Muir, acting as the main signatory.

Muir said Colliers was focusing upon the rates revaluation – which has been put back to 2017 – because of its “devastating” potential, particularly across the retail sector.

It effectively means many firms will spend an extra two years paying inflated levels of tax based on the value of their properties prior to the 2008 financial downturn.

Colliers estimates that the average bill in Scotland would come down by somewhere between 23 and 25 per cent if the current state of the market was taken into account.

“This does exactly the opposite of what the Scottish Government has declared publicly as its policy, where it is committed to allow businesses to ‘set up, grow and flourish’,” Muir said.

“At a time when businesses need all the support they can get, a stealth tax aimed at the heart of the Scottish economy means many businesses are being denied decreases that could mean the difference between survival or closure.”

In last week’s Autumn Statement, Chancellor George Osborne said the UK government would offer temporary rates relief on newly built business properties that remain vacant.

Scotland, meanwhile, is abolishing relief on empty retail and office space from April of next year. Government figures suggest rates are set to increase by 22 per cent over the next three years.

Hilary Witts, the Co-operative Group’s valuation manager, said she is concerned about “considerably over-assessed” properties, especially north of the Border where there are 650 Co-op sites.

“We are finding the food store assessments in particular are more top-heavy in Scotland than in the rest of the UK,” Witts said. Those costs are borne by the profit and loss account at each site, and therefore “could affect whether a store stays open”.

Amy Dalrymple, policy and research manager at the Scottish Chambers of Commerce, said a revaluation would result in lower bills for a majority of businesses.

 

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