Two prominent north-east businessmen have been forced to shelve business plans they say would have created dozens of jobs in Banff.
Des Cheyne, who owns Banff’s Spotty Bag Shop, and Kenneth West – a director of Banff Springs Hotel – are reeling from a £50,000 election day bombshell bill for business rates for a derelict industrial building they acquired last November.
The out-of-the-blue rates demand is for the former Grampian Country Chickens warehouse and site in Tannery Street, Banff, which Mr Cheyne and Mr West planned to use for a new venture they hoped would create jobs in a bleak employment area.
New rules in force since the start of April mean industrial properties are now eligible for rates relief of just 10% after six months lying empty, against 100% previously.
The change is retrospective, so the Banff duo’s six month period of grace was all used up by the time they received their shock bill on Thursday.
Mr Cheyne said no one he had spoken to knew anything about the new rules.
He added: “This seems somehow to have been railroaded in through the back door.
“Businesses, especially small businesses, simply can’t afford to pay full rates on premises which are not up and running.
“It’s impossible to even consider setting up something in the short-term when you are faced with these draconian taxes.”
Empty property relief has also been reduced for offices and retail premises, but not to the same extent.
Mr Cheyne and Mr West had not decided what type of business to launch on the four-acre site – a retail or sports facility were among options considered – but their dreams are now in tatters.
“We were planning to do something positive for business and for employment in the Banff area,” Mr Cheyne said, adding: “We thought we could revitalise the former site of Grampian Country Chickens, where lots of local people used to work.
“To create a new business from such an iconic site would have been fitting and empowering for local people.
“But having this bill foisted on us means we simply can’t do it. It’s a massive slap in the face to the people of Banff.”
Mr West said: “Every day jobs are being lost and businesses are going into administration, so you would think that creating employment would be incentivised not penalised, but that obviously is not the case.
“It’s not just about Banff though. This will affect the plans of businesspeople throughout Scotland. I think it’s going to put paid to thousands of business ventures and really impact severely on employment throughout the country.”
Mr Cheyne and Mr West together employ nearly 200 people in their existing businesses.
A Scottish Government spokesman said: “As announced last year, we will review business rates to ensure the system minimises barriers to investment, is responsive to economic conditions and supports long-term growth and investment.”
Former Royal Bank of Scotland chairman Ken Barclay is due to begin the rates review shortly.