McArthur urges action to protect island businesses from rates rises

Orkney’s MSP, Liam McArthur has called on the Scottish Government to pause the ongoing business rates revaluation and to consider the impact rising rateable values will have on rural and island-based businesses.  

Mr McArthur has written to Ivan McKee, Minister for Public Finance to highlight that the scale of increases will be unsustainable for many businesses operating in island communities. He has also sought confirmation that the rate relief for island hospitality businesses will be maintained in this week’s Scottish Government budget.  

Mr McArthur’s call comes on the back of reports from local businesses facing exceptionally large increases to their rateable value for the next financial year. A change to valuation methodology appears to be impacting self-catering businesses especially, but other small businesses in hospitality and tourism are also reporting unprecedented rises.  

Commenting, Mr McArthur said:  

“Island businesses already face higher operating costs than most. Additional challenges around importing and exporting stock as well as more limited turnover potential due to seasonal demand are often more keenly felt.  

“Against that backdrop, the proposed increases to rateable values are of real concern to small business owners in Orkney, many of whom are reporting increases in costs exceeding several thousands.

“The government should pause the ongoing revaluation to ensure that small businesses are not facing a cliff-edge when these changes come into effect later in the year.

“Small businesses are the lifeblood of our local economy in Orkney. They are already facing enormous challenges due to the cost of living crisis and a squeeze on consumer demand. In that context, the proposed increases in rates present an existential threat to many of these businesses.

“As well as pausing the rates increases, Ministers must also commit to extending the relief for island-based hospitality businesses. This measure has been crucial to protecting key businesses in Orkney still rebuilding post-pandemic. In light of the challenges they continue to face, this vital support must not be removed”.