Rates overhaul is long overdue

By Gillian McKenzie

PUBS’ business rates – and the way in which they are calculated – were back in the spotlight again last week.

Scottish Licensed Trade Association chief Paul Waterson renewed calls for the Scottish Government to overhaul the system, claiming it is unfair and a major burden on operators.
Currently a pub’s rateable value, on which business rates are based, is calculated on the venue’s turnover, while square footage is used as the basis for other business types, including licensed shops and supermarkets.
The result is that many pub operators see around 8% or 9% of their turnover going on rates, compared to just 1% or 2% for other businesses.
The Scottish Government has introduced business rates relief measures, under which it claims two in five pubs pay zero or reduced business rates.
But surely the fact pubs are treated differently in the first place must be addressed.
That current rateable values, which have been in place since April 1, 2010, are based on 2008 figures and the trading landscape for many on-trade operators is now very different only underlines the need to review the system.
Pubs’ vital role in Scotland’s tourism industry is widely acknowledged – surely it pays to help licensed trade businesses flourish.
Political minds are, understandably, focused elsewhere at the moment.
But let’s hope that after the September 18 referendum, whatever the outcome, the Scottish Government addresses the business rates imbalance once and for all.