The sector has long called for an urgent reform of the business rates system in Scotland and so it was positive to see the proposals of the Barclay Review. If they are now implemented by the government it could be a positive step forward.
However, there are still many issues that haven’t been addressed. Some, such as material change of circumstances appeals, have been missed from the report.
Stimulating growth and boosting investment is the Scottish Chamber of Commerce’s guiding principle in reforming business rates and the business growth accelerator, which will provide a one-year holiday on investment in new machinery or business expansion, is good for Scottish business.
Yet the remit of the review group included reforming the system so it could reflect changing economic and trading conditions, which is what our members have been calling for. So the sector is right to be disappointed that there was no mention of reviewing the legislation around material change of circumstance appeal rights which are more restrictive in Scotland than south of the border.
Business wants to see the rating system changed to one that responds effectively to economic conditions, but at least the move to more frequent revaluations as recommended in the report will help to achieve this.
Three-yearly revaluations from 2022 onwards won’t be of any help to businesses that are struggling at the moment with their rates liabilities. It is, however, a step in the right direction. Furthermore, if this is to be implemented in the recommended timescale, the government needs to take action now so businesses are confident it will actually happen.
Given that a change in legislation will be required, it is vital that the government puts this at the front and centre of the agenda when the Scottish Parliament is recalled this month. This will be critical if the review is ultimately to be taken seriously by businesses.