Scheme intended to cut rates may cost Scottish licensees

Many licensees in Scotland will have to pay higher rates thanks to a scheme that was intended to cut rates for small businesses.

The Scottish Executive's decision to go ahead with the new scheme, which will mean that two-thirds of tourist businesses and high street retailers face an increase in their rate bills, has left small business campaigners furious.

Gerry Dowds, director of the Forum of Private Business in Scotland, said: "We have warned them repeatedly that this scheme is totally flawed. This is not a listening Scottish Executive, it is one that pretends it cares but proves that it will throw our tourist trade onto the scrap heap."

"It will hit tourist pubs the worst. These have already suffered a devastating year after foot-and-mouth and September 11th."

Another campaigner, Bill Anderson, said: "They either don't have the ears to listen or the brains to comprehend what we are telling them.

"Less than 20 per cent of hotels, pubs, restaurants, caravan sites and petrol filling stations will benefit, while about 70 per cent will pay nearly three per cent more in business rates. I think they've gone barking mad."

However, the scheme will not be implemented until the next Scottish election in 2003 - and Mr Dowds is hoping to stop it going ahead completely.

"We will be mounting a very serious campaign and hope to encourage Liberal Democrat MSPs to withdraw their support. This would probably force the Scottish Executive to change its mind."

FPB Scotland wants the executive to introduce a system that evaluates relief for small businesses based on their employees' national insurance contributions rather than their rateable value.

This it says, would be a fairer system and would help licensees of small businesses that have already been hit by foot-and-mouth and the fall in tourism after the September 11 attacks on New York.