‘Nothing but a discriminatory tax raid’
By David Martin, head of policy at the Scottish Retail Consortium.
The Public Health Supplement, a flawed levy that hasn’t been adequately scrutinised, undermines the Scottish Government’s reputation of wanting to be business friendly and, inevitably, has unintended consequences.
The Scottish Government announced this measure without any discussion with the businesses affected or their representative bodies.
It applies to all retail premises with a rateable value of more than £300,000 that sell both alcohol and tobacco but the proposal didn’t feature in the Scottish Government’s manifesto and was introduced through secondary legislation which meant it wasn’t subject to full scrutiny or debate in parliament. Furthermore, despite the Government’s commitment to better regulation, the supplement was introduced without what is known as a business and regulatory impact assessment. That should be a basic and guaranteed stage.
The measure also utterly contradicts the Scottish Government’s broader policies on rates parity. It beggars belief that retailers, who already account for 28 per cent of all business rates paid in Scotland and who have shouldered a cumulative increase in business rates of around £80 million over the last three years, should be targeted in this way. It makes even less sense when you consider that the retail sector is Scotland’s largest private sector employer and that its ability to maintain and create much-needed jobs is already under pressure from weak sales.
Of course, as with all arbitrary and ill-thought-out interference in the market, the outcome of this supplement may not be as the Scottish Government predicted. It said it would bring in an extra £95m, over three years. Well, one major retailer has chosen to remove tobacco from ten stores, on a trial basis, which means those shops are not subject to the levy.
This poses a question. If the levy really is about public health, the Government should welcome that. If it doesn’t, isn’t it just giving the game away and admitting this is nothing but a discriminatory tax raid on one part of one business sector?
‘No surprise that Sainsbury’s sees a commercial advantage in temporarily ditching tobacco’
By Sheila Duffy is chief executive of ASH Scotland
What should we do with a product that contains at least 250 toxic chemicals and is as addictive as heroin, that is implicated in one in four deaths in Scotland and which kills half of its long-term consumers?
Often such a substance would be banned, as happened with asbestos. But this product is tobacco.
It has one million regular users in Scotland, two-thirds of whom started before they were 18 and 69 per cent of whom say they want to quit.
We have to help these people not criminalise them. So cigarettes remain in the shops, and efforts to reduce the harm caused by tobacco have rightly focused on regulating it and taxing it rather than banning it.
The three-year public health levy was intended to raise money rather than to reduce the number of outlets selling tobacco. Supermarkets have told us how little of their profit is generated by tobacco sales, so it is no surprise that Sainsbury’s sees a commercial advantage in temporarily ditching tobacco at some of its stores.
This may prompt customers to question the place of tobacco as an everyday product, on sale beside cough medicine and children’s sweets. But with nearly 10,000 retail outlets still selling tobacco across Scotland it will play a very small part in addressing Scotland’s damaging relationship with tobacco.
By preventing children from smoking, and helping smokers who want to quit to do so, we can reduce smoking rates to the small number of informed adults who genuinely wish to smoke. But the addictive nature of nicotine means that this will be a gradual decline over the years.
That has implications for retailers, but rather than stand with the tobacco industry in trying to hold back progress, the Scottish Retail Consortium should support its members in using this time to diversify to less harmful products.
Stubbing out tobacco kiosks
SAINSBURY’s has announced it is to stop selling cigarettes at six of its Scottish stores after a trial earlier year, launched in reaction to a new Scottish Government levy which experts said could see profits at major supermarkets reduced by up to ten per cent.
The new rates apply to large retailers that sell tobacco and alcohol, with the money used to help tackle the costs of problems associated with these products.
Tesco and Morrisons have said they have no plans to follow Sainsbury’s in scrapping cigarette sales.