Business leaders furious at £1m bill for city centre shops

The Evening News revealed last month that at least ten top retailers in the centre of Edinburgh would be hit by the new levy, but details have only just emerged of how much individual stores will have to pay.

Shops with a rateable value between 750,000 and 1m will pay an extra 2.5p in the pound on top of their normal business rates, meaning an additional bill for Boots of 24,500, while bigger stores such as John Lewis face an extra 12p in the pound, resulting in an additional bill of 256,800 a year. The annual bill comes to an extra 1,159,895.

Tom Campbell, chief executive of Essential Edinburgh, the Capital's business improvement district, said: "Essential Edinburgh absolutely opposes any suggestion that this is either an appropriate tax or one that will assist in the economic recovery and growth of the city centre. "If the money was ringfenced for town centre regeneration, there could be an argument that it would be doing some good to towns or high streets that are suffering. But it's not.

"This is going into a pot and it will disappear."

The levy, first announced by Finance Secretary John Swinney in his November budget, has been nicknamed the "Tesco tax" because it was supposedly aimed at large supermarket developments and out-of-town shopping centres.

The sliding scale on which retail premises will pay the levy was only revealed in a little-publicised statutory instrument. It is expected to bring in an extra 30m for the cash-strapped Scottish Government.

The Conservatives have now announced they will vote against the proposed new tax and say it can now only be passed if Labour supports the SNP when the Scottish Parliament's local government committee votes on it later this month. Lib Dems have already declared their opposition.

Lothians Conservative MSP Gavin Brown said: "At this time support should be being given to help businesses, but instead the SNP government seems intent on hitting them with this tax bombshell." Scottish Tory leader Annabel Goldie said: "The SNP has shown its true colours by proposing this 30m tax rise. The retail sector is a major employer - higher taxes will only make Scotland less competitive than the rest of the UK."

Enterprise Minister Jim Mather said the Scottish Government had removed or reduced business rates for 74,000 business properties in Scotland through its Small Business Bonus Scheme.

He said: "Ministers believe it would be wrong to raise council tax or reduce business relief schemes when economic recovery remains fragile, but that there is a case to raise some extra revenue from business taxation."It is expected only around 0.1 per cent of all non-domestic property in Scotland will pay the proposed large retail levy. Over 75 per cent will be from the largest supermarket stores."