A Highland hotelier voiced fears that rocketing business rates could be passed onto customers, giving the north a reputation as expensive, as this year’s bills started arriving.
The shock of bigger bills – in some cases double last year’s – has prompted a flood of applications for a rebate of up to 12.5% offered by the Scottish Government.
Many tourism business owners have confirmed they have no choice but to raise their tariffs rather than shed staff. And there is lingering concern about future rates with the rebate only guaranteed for a year.
Business leaders warned yesterday that the deterrent effect could spread beyond tourism, with evidence surfacing that northern England is a now deemed more lucrative than Highland for new business ventures.
Like many, the Kylesku Hotel in Wester Ross is in the process of applying for transitional rates relief after receiving a £37,500 annual rates bill – up from £21,000 last year.
Co owner Sonia Virechauveix said: “We’ll have to increase our prices because food prices have gone up.
“The cost of langoustines – one of our top sellers – has risen by 40%. We sell thousands and at some point someone has to pay for this. Unfortunately, it’ll be our guests. And we’ll have, yet again, a perception that Scotland is a very expensive place to come on holiday.”
The rates bill for the Applecross Inn has risen 59%, from £24,480 to £41,820.
Its business development manager Ann Fletcher said: “It’s expensive to run a business here, regardless. But with rates going up it’s got to be in proportion – and we feel the increase is disproportionate.”
The Kingsmills Hotel in Inverness has also requested transitional relief after receiving a rates bill of £425,000 – up from last year’s £230,000.
Managing director Tony Story said: “We wait to hear, with baited breath, whether we’ve got it or not.”
Stewart Nicol, chief executive of the Inverness Chamber of Commerce, fears the threat to the area’s financial reputation goes beyond tourism.
He said: “There’s a real concern, with business rates and the apprenticeship levy, that we’ll send out the message that says Scotland is an expensive place to do business.”
A spokeswoman for the Scottish Government said: “We’ve acted to reduce the total business rates take this year including by cutting the rates poundage, expanding the small business bonus scheme and limiting the extent of the large business supplement.
“That means that this year seven out of 10 premises are paying no or less rates than they did last year.”
