The Scottish Retail Consortium wants reform of the £2.8bn business rates tax to be an immediate priority for the next government following Scottish elections in 2016.

It is seeking a firm commitment from the major Scottish parties to a fundamental structural reform of business rates, including whether it should remain a property-based tax.

In the shorter term it is seeking urgent changes to the system to “arrest the number of store closures, assist town centres, support business investment and protect jobs”. This includes introducing more frequent revaluations and empty property relief for premises undergoing investment and refurbishment.

SRC director David Lonsdale said: “Lifting private sector investment will be crucial to help economic growth. There is a strong and growing consensus across business and industry in Scotland that the current business rates system is inadequate to the task, out of date, no longer fit for purpose and in serious need of fundamental reform. The system is a tax on jobs and growth, undermining investment in property, especially in town centres and high streets. It has moved in the eyes of many retailers from an irritation to mission critical in recent years.”

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The SRC has also warned that consumer spending could be hit if the SNP commits to hike personal income tax when it unveils its new legislative programme as early as this week.

MSPs return to the Scottish Parliament on Monday following the summer break and the SRC warned that “much greater certainty” was needed on how tax changes could hit disposable incomes.

“Retailers have a strong interest in the amount of money in Scots’ pockets. The less money they have the less they can spend in shops and online,” Lonsdale said. “What we don’t want, and don’t really expect at this initial stage anyway, is the new Scottish Rate of Income Tax to be higher than the UK rate. We would definitely not support that.”
The Scottish Parliament will be able to levy its own income tax rate from April 2016.

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