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Opposition pledge to fight north-east business tax bombshell

Ross Thomson
Ross Thomson

Opposition parties have pledged to challenge the SNP over its controversial changes to business rates, which could hammer north-east businesses.

It has emerged that firms are facing a “catastrophic” multi-million pound tax bombshell as a new framework for properties comes into force.

The increases, which could see some firms charged hundreds of thousands of pounds extra, are the result of new rateable-values (RVs) which take effect from April.

Finance Secretary Derek Mackay insisted businesses in the north-east are “benefiting hugely” from SNP policies, suggesting firms had saved £1billion to date through the Small Business Bonus.

But North East MSPs have pledged to tackle the government head on over the issue at Holyrood.

Ross Thomson, Scottish Conservative MSP, said: “Given everything that the north-east economy has faced over the past two years, the last thing that businesses need is to be hammered by vastly increased rates.

“The Scottish Government must act on this, whether in the form of relief for companies affected or simply to delay implementation of the new valuations.”

One firm cited is oil and gas operator Apache North Sea, based at the Prime Four business park at Kingswells, Aberdeen.

The RV for Apache’s offices has increased by 47% to £2.2million, according to assessments seen by Eric Shearer, a partner at property firm Knight Frank.

Mr Thomson added: “North-east firms are being disproportionately hit by this, with some looking at increases of as much as 114%. That is simply going to be too much for some to take.”

Scottish Liberal Democrat MSP Mike Rumbles agreed the government should be challenged on the situation.

He said: “The government need to rethink their plans and come up with a localised strategy that meets the needs of our local businesses.

“It’s no use blaming our underfunded local authorities. Derek Mackay must go back to the drawing board before these rates come into force.”

A spokesman for Mr Mackay said the Tories had a “brass neck” for criticising their policies in the north-east when they had taken “billions of pounds in oil revenue and given next to nothing back to the region”.

He added: “Businesses across the north-east are benefiting hugely from SNP Government policies, including the Small Business Bonus, which has saved firms across Scotland more than £1billion to date, and which will be expanded from 2017 to lift 100,000 properties out of rates completely.

“We also announced a package of action to reduce business rates as part of the budget, and the overall business rates poundage – the core tax rate that applies to the rateable value of business properties – will be cut by 3.7% to 46.6p.

“We are also supporting the economy in the north-east, including the Aberdeen City Deal and the additional £254million investment announced alongside it, in addition to investing £745 million in the Aberdeen Western Peripheral Route.”