Meeting of the Parliament 07 January 2026
Not only has the minister exposed this afternoon the fact that he does not understand how the fiscal framework works, he is now exposing the fact that he does not understand how non-domestic rates work. Either the assessors are independent—and the valuations are arrived at independently—in which case, he can, absolutely, make observations about the scale of the impact, say what analysis has taken place and tell Rachael Hamilton the calculation of the number of small businesses that will be taken out of the small business bonus scheme—or they are not. This Is a nonsense.
Acknowledging the concern or the potential impact has nothing to do with the budget—absolutely, I would not expect those details to be released. The minister cannot seriously stand up and say that he can make no further comment other than to acknowledge the concerns. That is a nonsense.
It is true that Scotland has had the least generous business rate support in the UK. A licensed premises in Scotland with an RV of £35,000, entering the new year, faces a loss to the tune of £33,000 in support that it would have received if it were in England. Likewise, a premises with a rateable value of £75,000 would have received £80,000, cumulatively.
However, it is not just about those individual impacts. Sectorally, it is a form of taxation that is unfair. Retail and hospitality share a burden of 22 per cent of the total rates bill, despite the fact that their economic contribution is just 10 per cent. Hospitality has an 8 per cent share of the rates bill, despite the fact that its overall contribution to the economy is just 4 per cent. That tax is unfair not just with regard to the most recent valuation; it is fundamentally irrational and does not land fairly with businesses.
We often quote the Adam Smith principles of equity, certainty, convenience and economy. Fundamentally, equity means that taxation should be based on the revenue that is raised. It strikes me that, given the contrast in the shares that are contributed by each sector despite their economic contribution, that tax is unfair and overdue for reform. It is exactly that reform—ensuring that sectors pay their fair share—that Labour is committed to introducing when we form the next Government, after May.
I move amendment S6M-20295.2, to insert at end:
“; believes that the current business rates system is not fit for purpose, and calls on the Scottish Government to create a new system that levels the playing field between the high street and online giants, better incentivises investment, tackles empty properties and supports entrepreneurship.”
16:19Motions, questions or amendments mentioned by their reference code.