Scottish hospitality organisations call for action on business rates

Hospitality bosses have called for business rates in Scotland to be brought in line with south of the border to avoid the “severe” impact of job losses and a lack of investment.

The Scottish Beer & Pub Association, Scottish Licensed Trade Association, Scottish Hospitality Group, Night-Time Industries Association Scotland and UKHospitality Scotland made the demand in a joint letter to the Scottish Government.

In the letter, the organisations said: “Without intervention, the impact will be severe – threatening jobs, investment, and the vibrancy of Scotland’s towns and cities.”

The organisations said during the period 2023-2026, small Scottish hospitality establishments with rateable values of £18,000 would have paid £11,095 more in tax when compared with their counterparts in England.

They also said it was “deeply concerning” that hospitality businesses in Scotland are paying up to 176% more in rates than those in England due to a lack of help from the Scottish Government.

In the letter, the organisations said: “Scotland’s hospitality and night-time economy businesses are vital to the success of our rural tourism economy, as well as our town and city centres, providing employment, investment, and driving footfall.

“The lower levels of business rates support provided to Scottish businesses over the last few years compared to their counterparts south of the border has resulted in a cumulative impact that is deeply concerning.

“If we take the example of a small pub with a rateable value of £55,000, the Scottish business would have paid £55,697.50 more in tax than the same business in England over those three years, or with a rateable value of £100,000, the Scottish business would now be £101,250 worse off than the same business south of the border.

“For businesses with a greater footprint such as a city centre, licensed premises, or a small hotel, the numbers are even worse, as the Scottish business with a rateable value of £200,000 would now be a staggering £210,700 worse off in just three years than the same business in England.”

The letter adds: “As representatives of Scotland’s hospitality sector and night-time economy, we are united in calling on the Scottish Government to deliver meaningful non-domestic rates (NDR) support in next week’s budget.”

A Scottish Government spokesperson said: “Recognising the ongoing concerns raised by the licensed hospitality sector, we are commissioning an independent review of the valuation of licensed hospitality properties to report by the end of 2026.

“The review findings and any recommendations will be considered in advance of the 2029 revaluation cycle.

“Decisions on non-domestic rates for 2026-27 will be set out in the Scottish budget next week.

“We will continue to work closely with businesses to drive economic growth and prosperity in our towns, cities and communities.”