Scotland’s licensed hospitality sector needs ‘breathing space and common sense’ from the Scottish Government until the review into non-domestic rates is complete.
Calling for an emergency summit with newly re-elected First Minister John Swinney, the Scottish Hospitality Group trade body stressed that moves towards long-term reform of NDRs were no comfort to hospitality businesses facing a financial crisis due to the latest revaluation round.
However welcome BJ Gill KC’s independent review into licensed hospitality rates valuation methodology was, SHG warned that businesses could not wait until 2029 for change.
Regarding the 40% interim rates relief offered to businesses with a rateable value of £100,000 or less, SHG noted that many independent venues sat above that threshold, and were thus still facing ‘unsustainable and unaffordable’ increases with little meaningful support.
SHG director Stephen Montgomery said: “There is a misconception that businesses with rateable values above £100,000 are large operators. That is simply not true. We have members with fewer than 80 seats now facing rateable values of over £130,000.
“Businesses are on the hook for these non-domestic rates payable now, and if they are appealed, the business still needs to pay until the appeal is heard, which could take a few years, which is time that these businesses don’t have,” said Montgomery.
“The Scottish Government talks about an overall average increase across the sector, but that is not what businesses are seeing on the ground. Some are facing rises of several hundred per cent, on top of rising costs such as National Insurance, energy and supply chain costs, coupled with a consumer cost of living crisis.
“Hospitality businesses are now being taxed on turnover and appearance, rather than true profitability,” he said. “A venue can appear busy, but that does not mean it is making money.
“If businesses close, there are no business rates, no jobs and no investment. The impact will be felt right across Scotland’s communities and high streets.”
Montgomery stressed that the licensed trade was not asking for special treatment: “We are asking for breathing space and common sense while the Gill Review is completed.
“The easiest and most sensible solution now is to halt these revaluations and bring government and industry around the table urgently.”
