A major review has called for private schools, universities and council leisure facilities to be liable for Scottish business rates.
The panel, led by former RBS Scotland chair Ken Barclay, has made 30 recommendations aimed at boosting growth, cutting administration and increasing fairness in the system.
Finance Secretary Derek Mackay welcomed the report, but opposition parties said it fell short of expectations.
Among the measures proposed is a new relief for nurseries, a move to three-year revaluations and extra support for town centres.
READ MORE: Guide for student teachers aims to help them support pupils with learning difficulties
The review recommends halving the large business supplement, currently paid by properties with a rateable value over £51,000, to 1.3p, to bring it in line with England.
It also proposes a year-long delay before rates are increased when existing properties are improved and backs an evaluation of the Small Business Bonus Scheme, which offers rates relief for businesses with a rateable value of £35,000 or less.
The report acknowledges that an overhaul of charity relief was "controversial" but necessary to increase fairness in the system.
ALEOs, often created to run council leisure facilities, have charitable status that allows them an "unfair advantage compared to private sector businesses offering the same or very similar services".
READ MORE: 'Pupils struggle because their understanding of the world is different’
The report argues that private schools benefiting from reduced or zero rates bills is also "unfair" while commercial elements of universities, such as halls of residence that are rented outside of term time, should also be liable.
Sports clubs reliefs should also be reviewed to ensure they support affordable community-based facilities rather than prestigious golf clubs, it said.
Mr Barclay said: "Ratepayers providing the same goods or services should not be treated any differently because of their location, or by virtue of them operating in the public or private sector.
"We have also highlighted unfair advantages gained by anomalies within the system, and of those who deliberately avoid payment of tax. Neither is fair.
"These measures are essential for the rates system to remain credible for ratepayers and to ensure revenues are not undermined by avoidance tactics.
"We are clear, this is not about penalising certain sectors, it is about compliance, fairness and transparency."
The publication of the review follows widespread concern about the impact of a controversial revaluation earlier this year.
Mr Mackay was forced to offer more assistance to businesses facing large increases following the first revaluation of the rateable value of businesses since 2010.
READ MORE: Guide for student teachers aims to help them support pupils with learning difficulties
He said: "This report offers recommendations for reform of the system to make it work better for ratepayers across Scotland, while ensuring that the contribution they make to important local services is maintained.
"Having now received the Barclay Review, the Scottish Government will respond swiftly to its recommendations."
Scottish Conservative finance spokesman Murdo Fraser said: "There are many welcome proposals within this report.
"But many firms will feel this is tinkering round the edges of a broken system, rather than the fundamental overhaul that's required."
Green MSP Patrick Harvie welcomed the proposal to evaluate the Small Business Bonus Scheme but said it was disappointing the review did not propose "bold measures" such as a move to a land value tax.
Councillor Carolyn Caddick, for the Scottish Liberal Democrats, also backed a move to a system of land value taxation and said it was "disappointing" the report did not offer businesses protection from "gigantic rate increases" this year.
Scottish Labour's Jackie Baillie MSP raised concerns that if ALEOs paid business rates it would be "another burden on public services which are already dealing with budget cuts made by the SNP government".
"It is also disappointing that a fundamental overhaul of the system is not on the table," she said.
Councillor Gail Macgregor, council body Cosla's resources spokeswoman, said: "Councils are under significant financial pressure and seek to protect services.
"As part of protecting services, councils need to make savings. If this option is removed from councils this will have a big impact on frontline delivery of much-needed services such as leisure.
"I absolutely refute any suggestions that councils have deliberately avoided paying rates. We do not accept this. These are legitimate decisions and cannot be construed as avoidance."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article