Following the Draft Budget Announcement in the Scottish Parliament this afternoon, the Scottish Licensed Trade Association released the following statement:
“The fate of many businesses and the jobs they provide in Scotland’s licensed hospitality sector lay in the hands of the Scottish Government and a lifeline for many operators was not just hoped for but prayed for in the Scottish Budget this afternoon.
“Of course, we all want to see adequate funding for the NHS and social welfare reform, but the government needs revenue to do that, and if businesses continue to close, cut back on services or opening hours and reduce jobs, coupled with reduced profit margins, where will that revenue then come from?
“With commercial rates being squarely within the Scottish Government’s remit, it was an area they could have done something meaningful with to help licensed hospitality businesses. Businesses that have, for decades, proportionately paid more than other business sectors due to the archaic system of methodology used specifically for the industry.
“Commercial rates, particularly with the new rates revaluations for the next three years, is the hot issue for the licensed hospitality sector. That is why the Scottish Licensed Trade Association and other key industry bodies urged the Scottish Government to continue with the current 40% support package. But we also sought removal of the £51,000 RV cap, which excluded over 2,500 businesses from receiving support, coupled with the introduction of a robust package of non-domestic rates support until the Scottish Government’s review of licensed hospitality non-domestic rates is completed.
“Whilst there has been a reduction in the basic, intermediate and higher property poundage rates to 48.1p, 53.5p and 54.8p respectively, the sector is still faced with the loss of the 40% discount for some businesses, replaced with a 15% relief in 2026/27 for the retail, hospitality and leisure sector liable for the basic or intermediate poundage rate, now that the £51k cap has been removed, and astronomical increases in rates bills, due to the recent revaluation, this Budget has gone nowhere near far enough to meaningfully help the industry.
“And let’s not forget there continues to be no relief support for businesses paying the higher poundage rate. All this on top of the years of financial support disparity between Scotland and businesses in England, which led to Scottish businesses paying between 112% and 176% more in rates than those rated exactly the same in England.
“To give that some context, a premises in England with a rateable value of £75,000 paid nearly £45,000 in commercial rates over the last three years – in Scotland they would have paid just over £120,000.
“The devil will be in the details following the Budget announcement and will need to be assessed further but it is no wonder there is a very real anger towards the Scottish Government for its failure to provide meaningful support to the sector in Scotland.
“With the Westminster government considering further support for pubs in England, following its derisory reduction in their poundage rate, the Scottish Government has committed to looking at any further support given by Westminster to the sector which will come to Scotland through the Barnett consequentials.
However, the Scottish Government doesn’t exactly have a good record of passing on funding through the Barnett consequentials directly to Scotland’s pubs and bars, who have previously lost out on 2 years of 75% rates relief given to pubs and bars in England.
Let’s hope this time it will be different.”
The Scottish Budget 2026-27 was published today. The proposed non-domestic rates measures are as below:-
- Decreasing the Basic, Intermediate and Higher Property Rates to 48.1p, 53.5p and 54.8p respectively for 2026-27.
- Small Business Bonus Scheme relief will be maintained at the existing rates and thresholds for the next three years.
- Shootings and deer forests will be excluded from eligibility for Small Business Bonus Scheme relief from 01 April 2026, except where a) shooting rights are exercised solely for the purposes of deer management, including to prevent damage to woodland or to agricultural production, environmental management or vermin control, b) crofts and c) all forms of agricultural and small landholding tenancies, leases for new entrants, and leases agreed for environmental purposes.
- Premises requiring a short-term let licence to operate will only be eligible for Small Business Bonus Scheme relief if they have a short-term let licence, from 1 April 2026.
- Payday lenders, advertisements, car parks, and betting shops will remain ineligible for Small Business Bonus Scheme relief.
- All the property categories which are ineligible for Small Business Bonus Scheme relief will also be ineligible for Fresh Start relief from 01 April 2026.
- Revaluation Transitional Relief for the next three years (2026-27 to 2028-29) will cap increases in gross rates liabilities for those seeing the highest increases in rateable values at revaluation.
Year-on-year Revaluation Transitional Relief caps (%), 2026-27 to 2028-29
| 2026-27 | 2027-28 | 2028-29 | |
| Small (rateable value up to £20,000) | 15% | 22% | 38% |
| Medium (rateable value £20,001 to £100,000) | 30% | 44% | 75% |
| Large (rateable value over £100,000) | 50% | 75% | 113% |
- Small Business Transitional Relief will ensure that those ratepayers losing, on 1 April 2026, eligibility for Small Business Bonus Scheme relief (including shootings and deer forests, but excluding those properties that require a short-term let licence but do not have one), rural relief, hospitality relief or Small Business Transitional Relief introduced for the 2023 revaluation cycle, do so in a phased manner. Eligible ratepayers will pay 25% of any increase to their net bill in the first year (2026-27), 50% in the second year (2027-28) and 75% in the third year (2028-29).
- 15% relief for eligible properties in the retail, hospitality and leisure sectors liable for the Basic or Intermediate Property Rate (those with a rateable value up to and including £100,000), capped at £110,000 per business per year. This relief will be available for three years from 2026-27 to 2028-29.
- 100% relief for eligible properties in the retail, hospitality and leisure sectors located on islands as defined by the Islands (Scotland) Act 2018, and in three prescribed remote areas (Cape Wrath, Knoydart and Scoraig), capped at £110,000 per business per year. This relief will be available for three years from 2026-27 to 2028-29.
- 100% relief for eligible Electric Vehicle-charging points for 10 years from 1 April 2026