SRC Preliminary Response to the Draft Scottish Budget 2018/19

In a preliminary response to the draft Scottish Government Budget announced this afternoon in the Scottish Parliament, SRC Director David Lonsdale said:


“With Scottish retailers feeling the pinch after a difficult year we’re glad the Finance Secretary has been more Christmas Elf than Mr Scrooge in this year’s Budget. The move to set the most competitive headline poundage rate in the UK is welcome, as is the move to scrap complex and costly proposals for an out-of-town rates levy. Similarly moves to protect ordinary workers from income tax rises and investment in infrastructure, housing, and skills are positive which should support the economy. The new Town Centre Fund appears to be a promising initiative and we’ll await the details with interest.


“Nonetheless, the growth projections from the Scottish Fiscal Commission are sobering. Continued growth of barely over 1 per cent presents a challenge for both retailers and government revenues. Similarly, whilst the headline poundage rate is set to be lower in Scotland, businesses operating from medium-sized and larger premises (including 5128 retailers) will continue to face a higher large business supplement than applies in England. Those are issues we would expect the Finance Secretary to engage with us on in the future.


“Our politicians will rightly and robustly debate the detail of the Budget’s tax and spending plans. However, especially in the current economic climate, businesses are keen for some semblance of stability and certainty and we therefore hope a collegiate approach will ensure that a Budget can be passed in a timely fashion.”



On changes to the NDR Poundage Rate

“With the burden of business rates remaining onerous it’s right the Finance Secretary has taken action to keep down the headline poundage rate, although he could have gone further. Nonetheless, he has acknowledged our concerns by striking a rate a touch below that in England. We estimate this will shave £2 million off the rates bills of retailers in the coming year than would otherwise be the case, albeit their rates bills will still rise in April by over 2 per cent.”

On Scrapping an Out of Town Rates Levy

“We’re pleased the Finance Secretary has listened to the chorus of concern led by the retail industry surrounding the proposals for a costly and complex new local out of town rates levy. Confirmation of the decision to scrap this pernicious proposal will be toasted by the business community.”

On proposals for a new Town Centre Fund

"Retailers welcome the new funding to boost high streets and town centres and facilitate re-invention to modern and diverse retail destinations. We await with interest further details of the plans, particularly around how the funding will be targeted, who will be eligible and how quickly funds will be made available.”

On Income Tax

“With retail sales currently sluggish we have raised concerns rises in tax rates for ordinary workers would harm the economy. The decision on income tax rates is a positive one which will support consumer spending and bring a little comfort to hard-pressed retailers.”