New figures published by the Scottish Government suggest that pubs and restaurants are seeing an average 5% drop in their business rates bills following revaluation from the start of last month.
However, UKHospitality Scotland has described the report from the Government’s Chief Statistician as ‘surprising’, with the trade body saying that it’s hearing from hospitality businesses that their rateable values have increased by up to 50%.
“The report does not reflect the reality on the ground, as felt by many of our businesses,” says Leon Thompson, executive director at UKHospitality Scotland.
“Instead, increased business rates are reducing the ability of businesses to invest, stifling economic growth and the creation of new jobs.
“Additionally, businesses are spending thousands of pounds and precious hours on appeals, in an effort to reduce poorly calculated bills.”
Thompson is calling on the Scottish Government to overhaul the business rates system, which he describes as being outdated and costly.
“The current system of business rates is holding our businesses back, with the punitive rates they pay preventing investment,” he says.
“It’s clear a new approach is needed if we are to achieve the Barclay Review’s aim of a business rates system that supports and encourages long-term investment.”
Thompson adds that he’s disappointment at the Government’s apparent row back on its manifesto commitment to reduce the Higher Property Rate, bringing it into line with England, describing it as a ‘further illustration of the extra costs hospitality businesses face in Scotland.
However, he welcomed the announcement of The New Deal for Business Group, a new initiative established by the Scottish Government to deepen links with the private sector, as well as details of a sub-group to look at non-domestic rates.
“There is much to do to improve the system and UKHospitality Scotland looks forward to engaging with the Business Group and the sub-group on this issue,” he says.