Retail industry calls on Kate Forbes to offer business rate discount for shops struggling 'in the shadow' of Covid pandemic

Retail industry bodies have called for the Scottish Finance Secretary to introduce a business rates discount for all retail premises for the coming financial year amid warnings that the sector is still struggling “in the shadow” of the Covid-19 pandemic.

Retail has not returned to the pre-pandemic levels seen above, industry bodies have warned.

The joint letter from 13 business representative groups, warned that the challenges facing many businesses are “insurmountable”, adding that the retail sector has not seen a return to pre-pandemic footfall levels.

Signed by retail industry experts including David Lonsdale, director of the Scottish Retail Consortium and Dr Pete Cheema, chief executive of the Scottish Grocer's Federation are among the organisations which have written the letter, submitted to finance secretary Kate Forbes last week.

The letter says: “We fully recognise the support your government has provided to the industry during the pandemic, including the business rates waiver.

“Yet for all the progress in pushing back against Covid, it’s clear the retail industry is still struggling in its shadow. We are almost two-thirds of the way through the current financial year and store sales and shopper footfall in Scotland have yet to return to pre-pandemic levels, whilst shop vacancies have climbed to a six year high.”

The letter added that many retailers had incurred “significant debt” through the crisis including Covid loans and tax deferrals.

It added: “A return to full 100 per cent business rates from April, which were at an onerous 21-year high prior to the pandemic, will be insurmountable for many shops.”

The retail industry in Scotland employs 230,000 people and traditionally accounts for over a fifth of business rates. The thirteen organisations represent retailers, trade unions and others with a stake in the vitality of Scottish high streets and retail destinations.

The collective call comes ahead of the unveiling of the Scottish Government’s Budget on 9 December, which is expected to set the business rate and associated reliefs for the 2022-23 financial year.

Other signatories include Usdaw, the Booksellers Association of the UK & Ireland and the Scottish Property Federation, as well as the Federation of Independent Retailers and The Horticultural Trades Association.

David Lonsdale, director of the Scottish Retail Consortium, said: “This is an unequivocal statement from a formidable alliance of Scottish industry and trade unions that urgent action is required to support the health and recovery of the retail sector.

“Hopefully, the Finance Secretary will take heed and act in her Budget next month to reduce business rates for all retail premises.”

Scottish Conservative shadow finance secretary, Liz Smith, said: "A discount to business rates will give physical retailers and businesses the support they need to recover from the effects of the pandemic, while helping to revitalise our high streets and town centres.

"The SNP Government must urgently start listening to businesses, and put into place the support measures they need to grow back stronger.”

A Scottish Government spokesman said: “The Scottish Government is currently providing a generous non-domestic rates regime that supports a total package of reliefs worth almost £1.5 billion, including an extension to the relief for the retail, hospitality, leisure and aviation sectors throughout 2021-22, which will save ratepayers an estimated £752 million this financial year.

“Further details on rates for the next financial year will be outlined as part of the draft Budget on December 9.”

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