John Swinney and city business chiefs to hold talks on rates

Published on Friday 14 May 2010 10:48

FINANCE Secretary John Swinney has agreed to meet business leaders from the Capital over the massive hikes in rates bills which they warn could cost jobs.

But he defended his refusal to introduce a transitional relief scheme which could cushion companies against the increase in business rates resulting from a revaluation of properties.

Edinburgh Central Labour MSP Sarah Boyack raised the issue in the Scottish Parliament and said many city businesses were losing out because of the absence of transitional relief.

A survey by Edinburgh Chamber of Commerce last month found four out of five firms planned to challenge their rates bills after some saw the demands double. They warned the increases could mean job losses or even drive companies out of business.

Ms Boyack said: "This is something businesses in Edinburgh are very worried about."

She asked Mr Swinney to meet her and the chamber of commerce to discuss the concerns.

Mr Swinney said he would be happy to do so. But he added: "The question of a transitional relief scheme is one the government considered and I decided not to take that route. What it would do would be to deprive a significant number of businesses of the reduction to which the revaluation process had indicated they were entitled."

But he said all businesses in Scotland, including those in Edinburgh, would benefit by more than 200 million in 2010-11 from the decision to match the English poundage rate.

Ms Boyack welcomed the meeting but said she was disappointed by the government's opposition to transitional relief.

She said: "English companies are benefiting from staged increases to soften the blow of increased rateable values and businesses in Edinburgh are crying out for the same protection.

"I am aware of many small businesses in my constituency that are being placed under extraordinary pressure.

"The hotel sector is also being squeezed with an average rate rise of almost 20 per cent."

Ron Hewitt, chief executive of Edinburgh Chamber of Commerce, said his organisation had campaigned to equalise business rate poundage north and south of the Border. "However, by opting not to introduce transitional relief in Scotland following this latest re-valuation, the playing field has again been tilted against us," he said.

Michael Apter, managing director of Paper Tiger, which has shops in Lothian Road and the West End, said revaluation would see his annual rates bill increase by 43 per cent. He said: "Given the current economic climate such an increase will place real pressure on our budget."