The hospitality trade has ramped up calls for support as the Scottish Budget nears, declaring that the current business rates system “unfairly penalises” the sector.

More than 400 business leaders, from multiple operators such as Buzzworks and the McGinty's Group to a raft of independent concerns, have signed a letter to the Finance Secretary Shona Robison setting out the industry’s position.

The letter backs a call from the Scottish Hospitality Group for Ms Robison to cut the business rates poundage to 35p for all licensed hospitality premises without a cap when she presents the Budget on December 4. It also makes the case for a “more equitable” long-term replacement for the current non-domestic rates system ahead of revaluations in 2026, stating that hospitality is penalised under current arrangements. This is because business rates for hospitality are based on turnover while for other sectors bills are based on a square footage calculation, SHG states.

Read more:

Stephen Montgomery, director of the trade group, said: “Restaurants, hotels, and pubs are the lifeblood of our communities, but the current business rates system unfairly penalises Scotland’s hospitality sector and is not fit for purpose.

“That is why we need to see the Scottish Government deliver urgent rates relief in the budget on December 4 by reducing the poundage to 35p without a cap.

“As our open letter shows, such a change is overwhelmingly backed by the hospitality sector and has the support of some of Scotland’s largest employers, as well as the wider Scottish public.

“By backing the hospitality sector in the coming budget, the Scottish Government can help the industry to deliver more jobs and investment, turbo-charging economic growth and further supporting Scotland’s communities and high streets.”

Meanwhile, the Confederation of British Industry (CBI) in Scotland is calling on the Scottish Government to “unleash investment” in its pre-Budget plea.

In its Budget submission, CBI Scotland makes the case for a new tax strategy to prioritise long-term economic growth over short-term revenue-raising measures, and for a long-term review of business rates, stating that the multiplier should be frozen to support businesses facing rising cost pressures. It also wants ministers to publish a consolidated skills strategy and action plan.

Mags Simpson, interim director of CBI Scotland, said: “If the Scottish Government is serious about growth, it must get to grips with the sluggish investment that has plagued the economy in recent decades and tackle Scotland’s underperforming business investment which, as a share of GDP, lags the rest of the UK’s.

“The Budget, and accompanying tax strategy, must focus on addressing uncompetitive tax policies that are acting as a handbrake on growth. The Scottish Government should commit to meeting these challenges head-on by prioritising long-term economic growth over short-term revenue raising measures.

“Delivering a long-term review of the non-domestic rates system, as the UK Government have pledged for England, and a freeze in the basic, intermediate, and higher property rates, would go a long way towards supporting firms facing rising costs.

“With Scotland’s super natural advantages, there big growth opportunities available in the net-zero economy, particularly in areas such as on and offshore wind, and carbon capture and storage. Building confidence behind the Scottish Government’s Green Industrial Strategy by setting out how announcements, such as establishing Scotland’s first planning hub, will be funded and realised, can deliver real momentum for growth.

“With the announcement in the UK Budget of a record £47.7 billion for the Scottish Government in 2025/26, including a £3.4bn top-up through Barnett consequentials, the Finance Secretary can provide further funding to make Scotland a more attractive destination for investors, and support a sustainable economy. Our Budget submission identifies dynamic yet practical solutions that Scottish businesses are calling to be prioritised.”