SRC: £12 million Rates Hike will impact Shops across Scotland

24th October 2019

 

Today, 24th October 2019, the SRC publishes our 2019 Facts and Figures report into the state of the retail industry.  The report is published as new analysis shows retailers are likely to face a £12 million increase in their business rates bill. 

 

The Office of National Statistics Consumer Price Index (CPI) figure revealed inflation in September stood at 1.7 percent.  The September figure is used by the UK Government to calculate the non-domestic rates multiplier for the following year. The Scottish Government committed last year that increases in the poundage rate will be capped at CPI, although as with last year’s Budget the rise could be less than CPI. However, if it is in line with CPI, retailers will pay approximately £12 million on top of their existing rates liabilities from next April. Scottish businesses also pay a higher Large Business Supplement in Scotland which cost retailers nearly £14 million last year.

 

The impact of these changes can be seen in a new SRC report which highlights the significant economic and social contribution made by the industry, and demonstrates the seismic transformation underway in shopping habits. That includes analysis showing the number of shops fell by 4% between 2011 and 2016, and retail turnover fell by 8% in the same period. The report can be read here: https://brc.org.uk/media/594309/scottish-retail-facts-and-figures_2019.pdf

 

SRC Head of Policy Ewan MacDonald-Russell, said:

“This report confirms the trend of retailers operating with fewer workers from fewer shops; but with that effect being very different depending on which part of Scotland they are trading from. We know the ongoing costs of operating from property and employing workers are rising, and that’s putting enormous pressure on the industry, regrettably forcing some to make very difficult decisions.   

“The expected £12 million increase in the retail business rates bill will further exacerbate the pressure, especially at a time where consumers are only spending on essentials. That’s why the industry sees this years’ Scottish Budget as an opportunity for further action.

 

“ We have welcomed the changes to business rates through the Non-Domestic Rates Bill, and the new fiscal framework which limit rises to CPI. Even so, this year will see business rates rise by around £12 million for the industry, on top of a higher large business supplement which costs Scottish retailers a further £13.95 million a year.  With that in mind, we hope all the Holyrood Parties will support bringing the supplement back into parity with the rest of the UK – helping to support shops in every community across Scotland.”

 

Ends

 

Notes to Editors

 

The Fact and Figures Report contains a breakdown of the change in retail turnover, retail employment, and shop numbers between 2011-2016 (the most recent data when the research was done over the summer) for Scotland and for each Local Authority.  The data for those figures comes from the Scottish Government's Annual Business Survey.