A group of trade associations have jointly written to Deputy First Minister and Finance Secretary, Shona Robison, to voice alarm at the government’s consideration of a new business rate surtax and what it means for wider tax policy towards commerce.
The 16 organisations that signed the letter include the Scottish Retail Consortium, Scottish Chambers of Commerce, Scottish Tourism Alliance, National Association of Shopfitters, Scotch Whisky Association, IoD Scotland, Salmon Scotland, and the Scottish Wholesale Association.
The collective call comes ahead of the expected Stage 1 debate and vote on the Scottish Budget at Holyrood later today.
The joint letter said: “It is profoundly concerning that new taxes on business are being countenanced in such an arbitrary way and with apparently little regard to trading or economic conditions. We understand it is being considered to plug a gap in government finances.
“The way the announcement was made falls well short of the thrust of the New Deal for Business, which talks of no surprises and involving business at the very inception of policy development. It contradicts New Deal commitments on a more competitive and less complex business rates system. It also reinforces the perception that Ministers view rates more as a revenue generator and less as a means to stimulate much needed commercial investment and growth.”
The letter added: “Businesses make investment decisions based on the opportunities ahead but also the costs of operating and predictability of tax and regulatory decisions. A more ad hoc and less predictable approach to business taxes in Scotland sends out a poor message. We fear this move opens the door to other sectors being similarly targeted, particularly if the projected fiscal gap widens.
“We therefore urge you to reject introducing fresh complexity, cost, and unpredictability into the rates system with a new surtax, or with similar taxes aimed at other sectors in the future. We want Scotland to be a great place to do business and a clear signal from you that economic growth is the priority would be a positive step.”