Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Derek Mackay defends business rates changes

Finance Secretary Derek Mackay.
Finance Secretary Derek Mackay.

A competitive and thriving north-east economy has a major part to play in ensuring we have a competitive and thriving Scottish economy.

That’s why we are backing the north-east with an additional quarter of a billion pounds of investment alongside the Aberdeen City Region Deal, three-quarters of a billion pounds for the Aberdeen Western Peripheral Route, and improvements on the A90-A96 Haudagain Junction and development work for the new Laurencekirk junction – to name just a few examples.

And we stand firmly with Aberdeen’s energy industry, supporting renewables and decommissioning, but also backing our oil and gas industry during challenging times with support for innovation, retraining and business resilience.

However, when businesses in the north-east raise concerns about their competitiveness, it is my job as finance secretary to listen.

The Budget I published before Christmas includes measures to help with the rates revaluations and to support our commitment to Scotland being the best place in the UK to do business.

Firstly, by raising the threshold for 100% rate relief under the Small Business Bonus to £15,000 rateable value, over 6,000 businesses in Aberdeen and Aberdeenshire will simply not have to pay rates at all.

That’s a saving of up to £6,990 and means two out of every five local businesses in the area will not pay any rates.

Secondly, to ensure that only the largest businesses pay the large business supplement, this year’s Budget increases the threshold, so it only applies to businesses with a rateable value over £51,000 – meaning 400 fewer big businesses in the area will pay the supplement, saving them money.

And, because we recognised that the revaluation of business properties being undertaken by the independent assessors for the local authorities would see an increase in rates bills for some businesses, I took the decision to cut the tax rate that applies to a property’s rateable value – by 3.7% to 46.6p in the pound, supporting all those businesses who do have to pay rates.

There will always be a range of effects associated with a revaluation, which re-sets the relative value between individual properties, sectors and localities and I have heard the voices of those businesses who are seeing a rise in their rateable value and are concerned about meeting those costs.

The first step open to all those businesses who are concerned is to contact the assessor and discuss how they worked out the provisional value.

Final valuations will be published in March and businesses have until September to appeal. That process is entirely independent and I hope firms take up those opportunities.

At the same time, I can confirm the Scottish Government is listening. I’ve heard calls for a national “transitional relief” scheme to follow the revaluation. This would mean not just phasing in large increases in bills, but also phasing in reductions for many whose values have gone down.

Having looked at the impact that would have, I cannot justify keeping bills up artificially for small firms or having large utility companies – who would be the main beneficiaries – subsidised by smaller rate payers.

However, it is possible for local schemes to be put in place by local authorities. Local authorities retain all the revenue from business rates and, through our Community Empowerment Act, have the power to offer further rate reductions on top of those offered by the Scottish Government.

Local authorities can use rate reductions to attract new investment into town centres, to target specific locations or sectors of their economies or in this case, to alleviate the impact of a revaluation.

I am ready to work with both Aberdeen and Aberdeenshire on how we can maximise the benefits of this new power and work together to support north-east businesses.

Looking forward, an external review of business rates and their role in supporting economic growth is due to conclude this summer, and the government will respond swiftly.

At a time when we face the potential economic impact of a hard Brexit, which is already leading to rising prices, I am clear we must all work together to support business, foster innovation and maintain investment.

There is no doubt the north-east continues to have a strong economy and excellent potential for future growth, as does the whole of Scotland.

Finance Secretary Derek Mackay MSP

Already a subscriber? Sign in

[[title]]

[[text]]

More from the Press and Journal Scottish politics team

More from the Press and Journal