The SLTA (Scottish Licensed Trade Association) says the announcement by Scotland’s Finance Secretary Shona Robison to implement a 40% non-domestic rates relief package for hospitality businesses was made in a way to catch headlines but will do little to stop closures and significant job losses in the sector.
Paul Waterson, SLTA press spokesperson, said he was extremely disappointed with Ms Robinson’s announcement of very limited support for the licensed hospitality sector.
“Wide-ranging support on business rates was our big ask from the Scottish Government, especially after Westminster’s Budget which raised the level of employer National Insurance rates, cut the payment threshold from £9,000 to £5,000, and an above-inflation rise of 6.7% to the minimum wage. Together this means, on average, operators’ outgoings will increase by between £2,000 and £2,500 per employee.
“Quite simply the whole trade needed help to offset these costs. They have not listened to us and this announcement will only help those paying the basic property rate, which is those with a rateable value up to and including £51,000.”
Mr Waterson, describing this level of support as “unfair”, added: “Yes, we are delighted for those getting the relief but because we are rated on turnover and profit is not taken into account, many relatively small businesses in our trade are above the £51,000 threshold. This means many licensed premises above the cut-off point are now wondering if they will survive.
“There are still many businesses teetering on the precipice of closure with recent figures suggesting that 20% of UK pubs and bars are technically insolvent and other data said there was no profit in 80% of hospitality outlets in the UK. Closure rates in Scotland have been running at over double the rate of that in England.”
Mr Waterson said the SLTA continues to call for a review of the commercial rating system, where in Scotland “licensed hospitality businesses are disproportionately burdened with commercial rates charges in comparison with other business sectors in Scotland and, in comparison, with licensed hospitality businesses in other parts of the UK”.
In partnership with the Scottish Beer and Pub Association, the Scottish Licensed Trade Association has already called for the introduction of a permanent non-domestic rates licensed hospitality-specific multiplier of 35p to support pubs and bars, encourage investment, help revitalise high streets, and rebalance the disproportionate business rates burden.
Mr Waterson added: “This would end the sticking-plaster policies that only provide temporary relief for some businesses that bring life to our communities and our city and town centres, where we are seen as the saviour of the high street, and provide one of the largest ‘tourist attractions’ for both domestic and foreign visitors to Scotland with over 75% of foreign visitors and 68% of domestic visitors visiting our pubs, bars and restaurants during their stay.”