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Thousands of hospitality businesses ‘put on ice’ by Scottish Budget

UKHospitality Scotland has called on the Scottish Government to rethink its approach to business rates relief following the Budget, as the country’s hospitality venues continue to pay more than their English counterparts.

Thousands of hospitality businesses 'put on ice' by Scottish Budget

More than 2,500 hospitality businesses ineligible for support as a result of the measures introduced in the Scottish Budget, UKHospitality Scotland has said.

The Budget, announced in December, set out measures to provide 40% business rates relief for venues with a rateable value up to £51,000.

However, these measures have been deemed insufficient by UKHospitality Scotland as they fall short of the business rates relief afforded to hospitality venues in England, who will receive 40% rates relief up to £110,000.

The organisation has now argued that rather than support the sector, the measures entrench Scottish hospitality’s lack of competitiveness with equivalent venues in England.

This imbalance has been “the thorn in the side of Scottish hospitlity for several years”, according to Leon Thompson, Executive Director of UKHospitality Scotland.

Thompson said there was “enormous optimism when the Scottish Government announced relief measures in its Budget in December”.

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“That optimism quickly turned to despair for the thousands of businesses that realised they would be ineligible and that their bills would actually increase next year. For the third year in a row, many Scottish venues will also be tens of thousands worse off than their English competitors, too,” he said.

The lower cap on businesses eligible for business rates relief, combined with increases to the Intermediate and Higher Property Rate, will see businesses in Scotland face rates bills increasing by thousands year-on-year

A pub which just misses out on relief will pay £12,000 more in rates compared to an equivalent business in England. For a town centre restaurant, it will be £17,000 more. For a rural hotel, they will pay £25,000 more, according to UKHospitality estimates.

UKHospitality Scotland is calling for the Scottish Government to expand the 40% business rates relief so all hospitality businesses benefit.

“It’s clear the Scottish Government recognises the importance of hospitality to Scotland by its introduction of some relief, but the scheme unfortunately excludes medium and larger employers and businesses with plans to invest, which have now been put on ice,” Thompson said.

“We saw just this week how hospitality was the biggest driver of economic growth in November and I would urge the Scottish Government to harness that potential by supporting hospitality through a universal 40% business rates relief.”

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