Mackay to confirm backing for Scottish businesses amid rates confusion

Finance secretary Derek Mackay is to announce support for business in the wake of an outcry relating to the Scottish Government’s business rate hikes.

The move comes despite the Scottish government insisting that action it has already committed to will ensure that seven out of 10 business properties will pay the same rates or less next year, with half paying nothing as a result of its programme of property valuation-based tax .

The revaluation of how much firms have to pay is being carried out by independent assessors, funded by local councils.

The Scottish Assessors Association has published provisional values, with the finalised figures to be sent out in March before they take effect in the new financial year.

The last revaluation in Scotland was carried out in 2010 and the Scottish Conservatives have warned of an impending “crisis”, saying some businesses facing large increases could be forced to close as a result of the rates.

Opposition to the policy has been particularly strong in the north-east, where valuations fixed in early 2015 have not taken account of the subsequent oil sector slump.

A Scottish Government statement said Mr Mackay will today propose a parliamentary statement “to outline a further package of support that will help businesses in key regions and sectors of the Scottish economy to better deal with the impact of the forthcoming revaluation of business rates”.

Speaking ahead of the proposed parliamentary statement, Mr Mackay said: “I have set out a competitive package of measures to give small and medium enterprises the security and confidence to grow in these tough economic times.

“Under the Small Business Bonus Scheme 100,000 properties will pay no rates at all next year and a further 3,500 properties will benefit from 25 per cent relief. This package means around 9,000 properties will be up to £7,000 a year better off than their equivalents in England.

“Additionally we are cutting the tax rate that applies to a property’s rateable value by 3.7 per cent to 46.6 pence in the pound so even some properties with values going up will see their bills go down. And to help larger firms we have increased the threshold for the large business supplement, meaning that 8,000 fewer premises will pay it.

“These actions worth £155 million, with an overall package of reliefs worth £600 million, mean seven out of ten business premises in Scotland will pay either the same rates or less next year – with more than half paying nothing at all.

“Before the new property values came out I took action to support business. Since then I have been listening to firms across Scotland and today I will set out further steps to support Scotland’s economy.”

Conservative finance spokesman Murdo Fraser said businesses need “real help” from the Scottish government.

“If they don’t take meaningful action we face seeing the Scottish economy suffering as many businesses across Scotland will be left with no choice but to close,” he warned.

Mr Fraser also said: “Derek Mackay was warned months ago about the damage that these rates increases could cause, but it’s taken until now for him to do anything about it.

“He’s been dragged to parliament kicking and screaming after we forced him into discussing the issue with an urgent question.

“It was clear that a crisis was emerging but instead of acting the SNP sat back and tried to pretend that it had nothing to do with them.”