Firms in these sectors with slightly larger premises will also become liable again for the Higher Property Rate, a tax that applies to almost 3,000 retail premises in Scotland and which will see affected properties pay a higher tax rate than their competitors or counterparts in England.

The reinstatement of business rates comes as one in six retail premises in Scotland is lying vacant and with retail sales and shopper footfall yet to climb back to pre-pandemic levels. Retailers account for over a fifth of business rates.

From 1 April the headline/basic rate poundage will rise to 49.8p in the £, its joint highest level since the advent of devolution in 1999. Since the start of the previous decade the poundage/tax rate has leapt from 40.7p in the £ to 49.8p in the £, a rise of 18%.

Over 12,000 commercial premises across all sectors are subject to the Higher Property Rate surtax and are set to pay 52.4p in the £. A quarter of these premises are retailers. The Barclay Rates Review had called for restoration of parity with England on the surtax by 2020, viewing the divergence and higher tax rate as “damaging perceptions” of Scotland as a place to invest. The Scottish Government has said it aims to restore the levelling the playing field with England by the end of this parliament.

Holyrood’s Finance Committee recently acknowledged that retailers’ accumulated debts, tax deferrals and loans have grown during the pandemic. Other statutory and supply chain costs are rising for businesses including the increase from next week in employers’ national insurance contributions.

David Lonsdale, director of the SRC, said: “The business rates waiver over the past two years of the pandemic has been substantial and much needed. It helped keep retailers afloat at a time when large swathes of the sector were forcibly shuttered for at least 220 days, when trading and capacity restrictions applied when shops were permitted to trade, and helped fund retailers’ outlays on PPE and Covid safety mitigations.

“As the guardrails of taxpayer support are withdrawn, retailers are ready to contribute their fair share. However, shopper footfall and retailers’ revenues are yet to climb back to pre-pandemic levels and firms are beginning to pay down Covid loans and tax deferral schemes. Coupled with the multitude of other government and supply chain costs which are currently rising, the reinstatement of rates at an onerous 23-year high comes at a challenging time for the industry and retail destinations.

“That’s why we want to see a medium-term plan for lowering the rates burden permanently and putting it on a more financially sustainable basis, coupled with early moves to restore the level playing field with England on the higher property rate supplement so that all premises in Scotland benefit from having the most competitive business rates in the UK.”