The potential impact of business rates for larger premises is casting a “long shadow” over Aberdeen’s high street, MSPs have been told.
A recent occupancy survey revealed a quarter of all retail units on the city’s Union Street were shut as national chains and independents struggled with the Covid-19 pandemic.
New research released last month also showed the Granite City has one of the worst-performing high streets in the UK for spending.
Liam Kerr, Conservative MSP for the north-east, has warned of a “reverse cliff edge” that awaits large businesses in the city once relief ends in April, who will have to pay a higher property rate if their rateable value is over £95,000.
He asked Public Finance Minister Tom Arthur what plans he has to introduce “fairer business rates system” and said the plan to reinstate payments in six months time is “casting a long shadow” on retail businesses.
In response, the SNP minister said Scotland has the “most generous package of rates relief anywhere in the UK”.
He added: “Indeed, we were the only part of the UK to give full NDR (non-domestic rates) relief for hospitality, leisure and aviation but I very much look forward to his constructive and informed contribution to that process later this year.”
The Scottish Government agreed in February that retail, hospitality, leisure and aviation businesses will pay no rates during the current financial year.
It has also provided businesses with more than £4.3 billion since the start of the pandemic and formed a city centre recovery taskforce.
‘A cliff-edge’
A retail occupancy survey carried out in Aberdeen during August revealed 47 vacant shops on Union Street – up by six, or nearly 15% since February.
Economic think tank Centre for Cities also released new research last month which showed the Granite City is the fourth worst in the UK for spending.
Aberdeen Inspired, the city’s business improvement group, has continued to call for a fairer business rates system in a bid to draw more firms to the city’s main thoroughfare.
Mr Kerr said: “The extension of rates relief to businesses was welcome but the fact remains that many larger shops and chain stores have still struggled, or have gone out of business.
“April will represent a cliff edge where they will go from full rates relief to potentially paying more than they ever did.
“I will continue to impress on Mr Arthur and his colleagues that this will need to be looked at again before the April reintroduction.”