Covid Scotland: Calls for Scottish business rates relief to match Wales as stores suffer 'sharp consequences'

The Scottish Retail Consortium has pointed to a discrepancy between business rates relief plans in Wales and Scotland, warning the existing Covid situation has had “sharp consequences” for stores at a crucial time of year.

In its Budget on Monday, the Welsh Government extended business rates relief to the whole of 2022/23, while Scotland has done so only for the first quarter of the new financial year.

This comes as new data on shopper footfall from the Scottish Retail Consortium (SRC) shows Scotland has suffered a steep decline over the past week.

Scottish footfall plummeted by a further 9.5 percentage points during the past week, with footfall down by a quarter in Scotland last week compared to the same period two years ago prior to the pandemic.

A member of the public wearing a face covering shopping on Buchanan Street in Glasgow.

David Lonsdale, director of the Scottish Retail Consortium, said: “Public health messages about working from home and socialising less, coupled with new restrictions which mean shops can’t trade at capacity, are having sharp consequences for Scottish stores in major city retail destinations at what is the crucial trading time of the year for many.

"Shopper footfall and retailers’ revenues are well below pre-pandemic levels and early indications over recent days suggests footfall has plunged further.

"If this persists, then government must stand ready to support retailers with further financial aid, including revisiting the time-limited and capped rates relief announced in the Scottish Budget.

"As it stands it will do little to help many retailers who continue to be battered by the fallout from the pandemic, especially the medium-sized and larger retail chains who underpin the vitality of our city centres and high streets and who employ the majority of retail workers.”

The SRC said: “In its Budget today, the Welsh Government extended the duration of its business rates relief scheme for retail, hospitality and leisure for all of 2022/23. In contrast, here in Scotland the devolved Budget extended the relief for the first quarter only of the coming financial year.”

The Scottish Government pointed out that small business rates relief in Wales is offered to occupied business premises with a rateable value up to £6,000 at 100 per cent relief, while those with a rateable value between £6,001 and £12,000 will receive relief that will be reduced on a tapered basis from 100 per cent to zero – but is not available on more than two properties.

In Scotland, 100 per cent relief is available up to a rateable value of £15,000 and 25 per cent relief up to £18,000.

For businesses with a cumulative rateable value on premises of between £18,001 and £35,000, businesses will receive 25 per cent relief on each individual property with a value of under £18,000.

Meanwhile, the Welsh Government has frozen its tax rate at 53.5p compared with 49.8p in Scotland, which the Scottish Government said is the lowest poundage in the UK for the fourth year in a row.

A Scottish Government spokesman said: “The 2022/23 Scottish Budget spending plan maintains the Scottish Government’s non-domestic rates reliefs package.

"This will save ratepayers more than £800 million and includes the Small Business Bonus Scheme, which takes over 111,000 properties out of rates altogether including over 28,000 retail units, and provides 100 per cent relief at thresholds that are more than twice that of Wales.”

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