The coalition of 35 business leaders from organisations representing various sectors of Scottish industry and commerce sent a collective letter to Shona Robison MSP, deputy first minister and finance secretary, calling for a freeze on business rates in the upcoming budget. 

The new budget is set to be released on 19 December this year, and will determine the business rate and associated reliefs and thresholds for the 2024-25 financial year.

The call for a freeze comes on the backdrop of increasing rates, which companies say are putting a further burden on them in an already challenging economic environment. 

Business rates in Scotland have reached a 24-year-high, and are significantly higher than they were over the last decade. If the rates increase in line with the current Consumer Price Index inflation, it could result in an additional £205 million in rates bills for businesses starting next spring, according to the consortium

“This would be at odds with the Scottish Government’s recently stated aim to use business rates to ‘boost business,” said the leaders in their statement. 

It also comes after last month’s announcement from First Minister Humza Yousaf saying that in the coming year, property-based taxes levied by local authorities would be frozen. In this case, any shortfall in revenue for local authorities would be compensated by a grant from the Scottish Government. This did not encompass business rates, which are also property-based. 

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In their letter, the organisations recognise the challenges faced by businesses and government, but argue that freezing business rate poundage would help businesses cope with rising costs, control prices for customers, and support business investment and competitiveness. This would, as the leaders hope, ultimately transition to the shared goal of sustainable economic growth. 

The letter was signed by Sandy Begbie, chief executive at Scottish Financial Enterprise, Tracy Black, director of CBI Scotland, Liz Cameron, chief executive at the Scottish Chambers of Commerce, Hussan Lal, president of the Federation of Independent Retailers Scotland, Andrew McRae, policy chair at FSB Scotland, Catherine McWilliam, nations director for Scotland at IoD Scotland, Paul Sheerin, chief executive of Scottish Engineering, along with many others.