BAILIFFS flooded into a famous city street as a row over a business levy described as a “stealth tax” intensified.
The enforcers were chasing furious Grassmarket traders who owe cash to a business promoting umbrella organisation.
The introduction of the Grassmarket Business Improvement District initiative (Grassmarket BID) has split opinion since it launched earlier this year amid claims it is poorly supported.
One trader said: “They really are using unacceptable bully boy tactics.”
In August, Edinburgh City Council issued summary warrants to 102 small business owners on behalf of the Grassmarket BID – and firms which have failed to pay the cash have warned they risk having stock seized and being declared bankrupt.
The scheme was started in February, but critics say only a quarter of business owners actually voted for it.
Joanna Potts, of Lady Jo Jo’s Boutique, who has refused to pay, said: “This is supposed to be helping and supporting small businesses but I don’t know how they can say that.
“A sheriff officer came in to my shop first thing on Thursday morning and served me with papers saying I had to pay the money. They said if I didn’t pay within 14 days, I risked being arrested, having all my stock sold at auction and being declared bankrupt.
“The money they want is an annual fee of £450, but with the sheriff officer fees I’m now also expected to pay, it’s more like £600 and could rise even more.
“I’ve only been open for three years and small businesses like mine don’t have that kind of money just lying about going spare, especially during a recession.”
Under a regulation adopted in Scotland in 2007, only 25 per cent of the affected owners were required to vote in favour of forming the BID, which imposes mandatory levies on all firms in a designated area based on the rateable values of their premises for five years.
A petition signed by more than 100 traders has been handed to the Scottish Minister for Local Government and Planning Derek Mackay calling for the results of the ballot to be scrapped amid claims of “material irregularities”.
Ms Potts added: “Some people have paid the money because they were scared this would damage their credit rating and leave them unable to trade.”
The body said it has helped businesses around the Grassmarket save money through a range of benefits, including discounts on the costs of insurance, water, electricity and broadband.
However, James McGonigle, owner of Spacey’s Bizarre Ink tattoo parlour, who has also refused to pay the levy, said: “Apart from donkey rides and a market that actually takes trade away from the shops, I don’t see what they have done for us. It’s just a stealth tax.”
Fawns Reid, chair of the BID board, said it was the responsibility of the council to collect the levy and declined to comment further.
A council spokeswoman said: “In the interest of fairness to those who have paid the levy and to ensure the BID is able to deliver its business plan, non-payment is pursued on behalf of the BID company.”
FROM THE BALLOT TO THE BULLET
January 2012: Plans are drawn up for a new “business improvement district” (BID) in the Grassmarket. Traders in the area are given their say about how the scheme will work.
November 2012: The proposals to spend £600,000 on improving the area over the next five years are voted in – with 59 of the 73 traders balloted voting “yes”.
August 2013: More than 100 traders face legal action over their refusal to pay the levy. Campaigners petition government ministers to scrap the results of the vote amid claims of “material irregularities”.