MSPs seeking views on proposed changes to business rates system

Buchanan Street, Glasgow - Image credit: Creative Commons

MSPs are seeking views on the impact of proposed changes to business rates in Scotland.

Holyrood’s Local Government and Communities Committee has launched an inquiry into the impact of the Non-Domestic Rates Bill.

The bill is the first of its kind to propose wide-scale changes to the current system in Scotland.

Non-domestic rates, or business rates, are charged on business properties, with money raised going to councils to fund local services.

Among the changes proposed in the bill are that private schools will no longer be exempt from business rates.

The bill also aims to address a tax avoidance tactic involving unoccupied or under-used properties, where owners can claim more advantageous tax reliefs by saying the property is in use occasionally rather than empty.

It will also close a loophole that enables owners of holiday homes to avoid both council tax and non-domestic rates.

Other changes include tax relief reforms for new or improved properties, revaluation of rates every three years rather than every five years, councils being able to begin debt recovery proceedings for unpaid rates sooner and clarification about when sports clubs should be allowed rates relief.

The bill was introduced in the Scottish Parliament on 25 March 2019.

It follows the Barclay review of the rates system, which made a series of recommendations for reform.

The local government committee is now asking for views on the various proposals in the bill.

Committee convener James Dornan said: “Non-domestic rates are the second highest revenue raising tax in Scotland and these reforms could affect a great number of people.

“We are keen to hear the views of potentially affected organisations and members of the public about the proposed changes to the system, and whether the Scottish Government has addressed the issues raised in the Barclay review.

“We also want to know if people think anything else should be included in this bill or if more radical reform of the system is needed.  

“We look forward to hearing what the public has to say and using the evidence to ensure our inquiry is as robust as possible.”