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Seòmar agus comataidhean

Question reference: S6W-32711

  • Date lodged: 20 December 2024
  • Current status: Answered by Kate Forbes on 14 January 2025

Question

To ask the Scottish Government, further to the answer to question S6W-32031 by Kate Forbes on 18 December 2024, whether it is taking any measures in its draft Budget 2025-26 to reduce the cost of doing business in Scotland, and, if so, what those measures are.


Answer

Further to the response to S6W–32031 of 18 December, the Scottish Government has taken a number of measures within the draft budget to reduce the cost of doing business in Scotland in 2025-26

Scotland’s Tax Strategy provides certainty and stability for taxpayers and businesses and sets out the intention not to introduce any new bands or increase the rates of Scottish Income Tax for the remainder of the parliamentary term. This helps businesses to plan and make investment decisions with confidence. The draft budget also prioritises capital investment in the foundations of our economy, including transport, digital connectivity, and delivering critical infrastructure, all of which support our businesses to thrive.

Local economies will be boosted by £62 million of regeneration funding alongside over £214 million through the City and Regional Growth Deals programme. This will deliver targeted investment in infrastructure, innovation and skills to unlock potential and stimulate growth in all parts of the country. Alongside this, increased investment in our planning system and local planning services, capacity, performance and resilience will ensure planning does all it can to drive the economy and improve certainty for business, reducing costs.

The Budget provides for direct support to business, through funding of over £321m for the enterprise agencies in 2025-26 to attract, start and support businesses across Scotland to grow. An additional, £15m Enterprise Package will be delivered in 2025-26 to expand support for female entrepreneurs, boost the economic impact of universities and fund the development of business clusters in advanced manufacturing and deeptech.

The budget freezes the Non-Domestic Rates Basic Property Rate at 49.8p (for properties with a rateable value up to and including £51,000), and is expected to save ratepayers £9 million next year. We are maintaining the Small Business Bonus Scheme, the most generous scheme of its kind in the UK, at the rates and thresholds introduced in 2023-24. Together, these measures will protect over 200,000 small properties, with an estimated half of properties in the Retail, Hospitality and Leisure sectors continuing to be eligible for 100% relief next year. The Intermediate Property Rate and Higher Property Rate have received inflationary increases (1.7%) however, this still ensures that over 95% of non-domestic properties continue to be liable for a lower property tax rate than anywhere else in the UK. On top of these measures, a new 40% relief will be introduced for Hospitality premises in 2025-26,

To support tourism, culture and hospitality we will continue to offer 100% relief in 2025-26 for hospitality businesses located on islands as defined by the Islands (Scotland) Act 2018, and in prescribed remote areas, capped at £110,000 per business. The new 40% relief for Hospitality premises includes Grassroots Music Venues with capacity up to 1,500, where the property is liable for the Basic Property Rate (rateable value up to and including £51,000) capped at £110,000 per business. The budget makes available up to an additional £2 million for VisitScotland, to work closely with partners to promote lesser-known destinations plus a £4 million capital revitalised Rural Tourism Infrastructure Fund (RTIF) to improve rural areas that face pressure on transport links and infrastructure.

For the retail sector we are providing up to £3 million to Police Scotland to work with the sector to target the unacceptable levels of crime on our high streets. Having committed to exploring the reintroduction of a Public Health Supplement for large retailers in advance of this budget, following exploratory discussions with stakeholders and taking into consideration cumulative burdens, including UK Government increases in employer national insurance contributions, there are no plans to introduce this at this time.

All answers to written Parliamentary Questions are available on the Parliament’s website, the search facility for which can be found at https://www.parliament.scot/chamber-and-committees/written-questions-and-answers