Meeting of the Parliament 08 September 2015
No—I need to make progress.
One year on from the referendum, the Government continues to agitate over the constitution.
As Jackie Baillie reminded us, the Federation of Small Businesses has charted business confidence in Scotland in relation to that in the rest of the UK over the past few years, with the odd exception. The latest figures make for grim reading: confidence has fallen in Scotland to a mere 1.7 points while, UK-wide, it stands at 20.3. Over the past year, the gap between the two figures has widened. When I intervened on him, the cabinet secretary was too quick to dismiss those figures. He should ask why the gap exists and why it has been widening. That should be a concern.
If the Scottish Government sincerely intends to make Scotland a competitive business environment, it must follow its ambition with actions. That is why we call for a root-and-branch review of the business rates system. It is perhaps surprising that that has not yet happened. The Scottish Government has established a commission on local government finance but excluded from its remit any examination of business rates, which are the single largest local tax in Scotland. I encourage the establishment of such a review, which I hope will be as open as possible and will consider the fundamentals of local business taxation.
There are a number of specific problems in the administration of the current rates system that could be addressed. For example, the rise in rates for empty properties has created a large additional expense for properties that are vacant because they are undergoing refits or refurbishments, which are already a considerable cost on business. There is a single assessor for business rates valuations for the whole of England and Wales. What case can realistically be made for Scotland retaining 14 assessors? Why is there no single mechanism for payment, rather than separate mechanisms for each of our 32 local authorities? Many issues need to be considered and I urge the Scottish Government to address business rates.
I do not have time to address the Scottish rate of income tax. I simply remind the Parliament that business needs clarity on that so that it knows that Scotland will indeed be competitive.
The Scottish Government will get our support and that of the business community if it does the right thing to create a more competitive environment in Scotland.
I move amendment S4M-14156.2, to leave out from “endorses” to end and insert:
“welcomes the positive action of the UK Government to build sustainable economic growth across the UK; shares the Scottish Government’s stated ambition to create a competitive business environment in Scotland; proposes that a full review be conducted into the application of non-domestic rates with a view to improving their competitiveness and efficiency; regrets proposals in the Land Reform (Scotland) Bill to alter the treatment of shootings and deer forests for valuation purposes, and urges clarity on the proposed use of the Scottish rate of income tax, which is being devolved in the next year.”
14:58Motions, questions or amendments mentioned by their reference code.