The Scottish Government will seek to implement the “vast majority” of the Barclay Review’s 30 recommendations for overhauling the country’s business rates system.
Addressing the Scottish Parliament (September 12), Finance Secretary Derek Mackay said the changes would lead to “a rates system that is fairer, more responsive and geared for growth”.
Mackay said that, in line with the review’s recommendation, revaluations of premises will in future be carried out every three years rather than every five years, and would be based on data from the previous year rather than from two years before.
Barclay also recommended reform of the Large Business Rates Supplement, which affects premises with a rateable value of over £51,000. This will now be brought in line with the rest of the UK and reduced to 1.3p by the end of the current parliament, “should it become affordable”. While less relevant to a lot of smaller business owners, the move will still reduce retailers’ rates bills by £12m annually.
A Business Growth Accelerator will be realised from April 1, 2018, giving tenants of new build non-residential properties their first year rates-free.
The Scottish Retail Consortium welcomed the Finance Secretary’s response to the Barclay Review.
Its Director, David Lonsdale, said: “We’re pleased to see Scottish Ministers take forward a number of welcome steps to modernise the creaking rates system not least with plans for more frequent revaluations and reducing by half the time between valuations and them coming into force.
“The commitment to bring the Large Business Rates Supplement back into parity with the rest of the UK is most welcome, albeit the timetable appears less ambitious than that put forward by Barclay who said it should happen by 2020 rather than the end of the Parliament. Swifter action to level the playing field on the Supplement is important in the context of continuing to attract investment, as otherwise 5,077 retail premises will continue to pay higher rates than their counterparts or competitors down south for the next three years.”