A campaign to halt the planned rise in hospitality rates, organised by the Scottish Hospitality Group, aims to amplify the voice of Scotland’s family-run restaurants, bars, pubs, and hotels, by calling on the Scottish Government to halt the current non-domestic rates revaluation for hospitality properties until after the Gill Review, a government examination of how licensed premises are valued for rates purposes.
Visible on giant advertising outdoor sites throughout the Central Belt from this week, the campaign was launched just as the Scottish Budget was finalised. However SHG says the Scottish Government can, and should, still act to stop the rates hikes before they come into force in April. The initiative highlights the devastating impact of rising non-domestic rates on Scotland’s hospitality sector – effecting premises including local and long-established family-run restaurants and hotels.
The Gill Review, commissioned to examine the valuation methodology for licensed premises, seeks to ensure the system is fair. Currently, hospitality is effectively rated on turnover, a methodology SHG says is no longer fit for purpose. Until the review concludes, it is unfair for businesses – especially those with higher turnovers – to face dramatic rate hikes in April, even with new relief measures for smaller premises.
“Hospitality businesses are being taxed on turnover,” said a spokesperson for the Scottish Hospitality Group. “Revenue growth is swallowed by wages, energy, food costs, and regulatory pressures, so even successful businesses are being punished simply for growing. There should be a pause on the current revaluation increases until after the Gill Review. Even after the Budget is rubber-stamped, the government can still act – to protect jobs, sustain communities, and safeguard the future of Scotland’s hospitality sector.”
Many SHG members, and other hospitality businesses – including Signature Group, DRG Group, Buzzworks Eusebi Deli, Lisini Group, McGintys Group, Scoop Restaurants and Rusk & Rusk, fall outside the thresholds for existing relief schemes and face crippling cost pressures. Established businesses that have invested heavily over decades report that development and expansion projects are being mothballed, shifting operators from growth into survival mode.
Said Susan Young, Editor of trade publication, DRAM, “The Scottish Government knows that the current methodology is flawed and has commissioned the Gill Review. Despite this, it has not halted the planned, unprecedented rates increases for hospitality businesses due to come into force in April. It is time for it to reconsider.
“The people I have spoken to across the country are disheartened and dismayed. They are cutting staff and shelving development plans. Having looked at the increases on the rates assessors’ websites, I have been dismayed at some of the exorbitant rises. It is time a decision was made to STOP the rates increases until the methodology is fit for purpose.”