UKH Scotland demands ‘new approach’ on business rates

19-May-2023 - Last updated on 19-May-2023 at 08:59 GMT

Review: UKH Scotland has quizzed the 2023 non-domestic rates revaluation claims (credit: getty/georgeclerk)

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UKHospitality Scotland says the Scottish government’s claim that pubs and restaurants have seen a decrease in their overall rateable value has not been backed up by hospitality businesses.

The trade body has demanded action be taken to reform outdated business rates for the hospitality sector after Scotland’s ‘chief statistician’ released figures relating to the 2023 non-domestic rates revaluation.

UKHospitality Scotland executive director Leon Thompson said: “The current system of business rates is holding our businesses back with the punitive rates they pay preventing investment.

“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.”

Report is ‘surprising’

He continued: “We’re hearing from hospitality businesses that their rateable values have increased by up to 50%, which makes the report from the chief statistician that rateable values are decreasing, surprising. The report does not reflect the reality on the ground, as felt by many of our businesses.

“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.

“The divergence in business rates north and south of the border sees our members pay higher rates here in Scotland than comparable businesses in England.

“[The] news that the Scottish government will not deliver on its manifesto commitment to reduce the Higher Property Rate, bringing it into line with England, is a further illustration of the extra costs hospitality businesses face here.”

Welcome news

Thompson added: “The New Deal for Business Group and details of a sub-group to look at non-domestic rates is welcome news. 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.”

The Scottish government said: “As a result of revaluation, the total rateable value increased by £390m or 5.36%, compared to that on the day before revaluation took effect.

“Shops, public houses and restaurants saw a decrease in their overall rateable value. Petrochemicals, quarries, mines, and sporting subjects had the highest proportional increases, while statutory undertakings and industrial properties contributed most to the overall increase.

“The average gross bill increased by 3.37% as a result of revaluation. This is lower than the increase in rateable value due to the general revaluation transitional relief. In addition to the gross bills for shops, public houses, and restaurants, the gross bill for hotels decreased despite the slight increase in rateable value.”