The Scottish Retail Consortium (SRC) has thrown its weight behind a campaign to overhaul Scotland’s £2.8 billion business rates system.
Setting out its case for reform, the trade body argued that the “anachronistic, unwieldy and expensive” system discourages investment, and said rates should be reviewed every year to reflect changing property values.
The organisation’s report follows a recent survey of MSPs that found 69 per cent agreed that the current system of business rates is in need of a shake-up, with 58 per cent agreeing that a reduction would stimulate business growth.
SRC director David Lonsdale said: “The SRC has long argued that the current system of business rates is not fit for purpose and acts as a drag on Scottish economic growth. It acts as a disincentive to invest and, unlike any other national tax, fails to flex with economic circumstances. It is, uniquely, a tax that only ever rises.
“Firms in Scotland are set to fork out £2.8bn in business rates this year, well over a quarter of this from the retail sector. However as I visit retailers across Scotland one message is consistently to the fore – their confidence to invest is being held back by the prospect of shelling out even more for business rates.”
Other bodies that have supported the call for reform include the Scottish Chambers of Commerce, Scottish Property Federation and the Scotch Whisky Association, which said: “Our members are increasingly investing in renewables and the lack of certainty of rates bills ahead of critical investment decisions acts as a disincentive.”
Among the changes proposed by the SRC yesterday are incentives for companies to invest in energy-efficient improvements to their property and the creation of a single assessor.
It also said reforming the system should mean that the overall tax burden on businesses is reduced.
Lonsdale said: “An overhaul of business rates would be a very effective and tangible step policy makers could take now to unleash business investment and growth that could bring with it many more Scottish jobs and a revival of our town centres.”
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