Study calls for tax powers to be devolved in Edinburgh, Glasgow and Aberdeen following pandemic challenges

A new report has called for tax powers in Aberdeen, Glasgow and Edinburgh to be devolved as cities face challenges from the pandemic, Brexit and the climate crisis.

Scotland’s biggest cities need tax raising powers, immigration to be devolved, an overhaul of business rates and major investment in connectivity to succeed in the future, according to the study.

The Urban AGE 2022 study of the AGE cities – Aberdeen, Glasgow and Edinburgh – was commissioned by Brodies LLP, Anderson Anderson & Brown and Aberdeen, Glasgow and Edinburgh chambers of commerce.

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The document calls on businesses and all levels of government to collaborate to ensure cities overcome the challenges they face.

A new report has called for tax powers in Aberdeen, Glasgow and Edinburgh to be devolved as city regions will soon outnumber rural dwellers for the first time in history, according to estimate.

The report found the pandemic, the climate crisis and Brexit had combined to create a potentially “toxic” cocktail of change for urban Scotland.

City inhabitants will soon outnumber rural dwellers for the first time in human history, estimates Professor Brian Evans, an advisor to the United Nations Economic Commission for Europe, who led the research team behind the report.

Prof Evans said Scotland needed the AGE city regions “at the top of their game” if the country was to remain globally competitive. “Cities need to be dynamic or they decline,” he said.

Despite accounting for just 22 per cent of Scotland’s land mass, these city regions house 68 per cent of the population and account for 73 per cent of the country’s gross value added [GVA].

AGE cities have been hit hardest by the pandemic, the report states, as it goes on to say Covid has “hollowed out shared spaces, devastated high streets and accelerated societal change”.

All cities lost a total of 124 weeks of sales, more than any city in England, due to Scotland’s stricter pandemic measures

The report recommends meaningful tax raising should be devolved and other fiscal powers to Scotland’s cities to allow them to fund investment and deliver programmes that reflects local needs and opportunities.

A major focus on increasing the residential population of city centres was also recommended to replace the critical mass lost due to technological advances and other social changes.

The report also states AGE cities should form an alliance to work collectively to accelerate their journey to becoming net-zero locations, and that immigration policy should be devolved to ensure cities and regions have access to the workforce they need to prosper.

The study looks at other recommendations such as significant and transformational investment in rail infrastructure to improve journey times between all three AGE cities and their extended regions.

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Russell Borthwick, chief executive of Aberdeen & Grampian Chamber of Commerce, said: “The updated report considers what has changed in light of the pandemic and the accelerating net zero carbon agenda, and also the many fundamentals which have not.

“It must be used to provide the launchpad to propel Scotland forward in the century of the city. And we ask Scotland’s policy makers to urgently work together with business communities to make the necessary interventions that will shape the next chapter for our AGE cities – and it must happen at pace.

“As agents of positive change, chambers of commerce and our project partners stand ready to play our part. Doing, not just talking.”

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