NE Scotland, Orkney & Shetland

Aberdeen hotelier Stewart Spence in business rates boycott call

Stewart Spence
Image caption Stewart Spence said he would only continue to pay his old rates

An Aberdeen hotelier has called for a nationwide boycott of new business rates after vowing to refuse to pay any increases.

Stewart Spence, who owns the five-star Marcliffe Hotel, said a complete rethink was needed on how rates were calculated.

Mr Spence told BBC Scotland he would only continue to pay his old rates and not what he said was a 25% hike.

The Scottish government said thousands of businesses would pay no rates.

Why are business rates causing concern?

Business rates - what do they pay?

It said the non-domestic rates would raise less money than last year because thousands of small businesses had been removed from paying altogether.

The Scottish government has raised the threshold for paying the rates from a rateable value of £10,000 to £15,000 and it has also reduced the rate poundage each business pays.

However, the rateable value of each property will change for the first time since 2010 after a national revaluation by The Scottish Assessors' Association.

Some businesses have seen a cut in the amount they pay but others have seen large increases. The hospitality sector has seen large rises and the north of Scotland has complained that the rises do not take into account the slump in the area caused by the problems in the oil industry.

Mr Spence said his business rates rise equated to an extra £1,000 a week, while turnover was down by 40% due to the downturn.

The hotel - a popular venue for wedding receptions and functions - has been at its North Deeside Road location since 1993.

Image caption The Marcliffe is a five-star venue

The Marcliffe was given a rateable value of £550,000 in 2010 but appealed and that was reduced to £497,000.

It now has a 2017 rateable value of £575,000.

The rateable value (RV) is an assessment of the annual rental value of the property and is not related to the profitability of the business.

The RV is combined with a poundage rate set by the Scottish government in order to arrive at the rate a business will pay.

Mr Spence said: "I am going to continue to pay my old rates - £253,000 a year.

"My new rates are £315,000 a year."

He called for others to take part in a boycott.

Appeal process

Finance secretary Derek Mackay said: "Nationally, more than half of premises will pay no rates, 70% will pay either no or less rates than they do currently and the total package of reliefs we are offering will increase to more than £600m.

"The Scottish government is fully committed to further engagement with the business community and stands ready to work with councils considering any options to provide support for businesses locally.

"The valuation of business properties is undertaken by independent assessors, funded by local councils, not the Scottish government.

"Each council retains all the business rates revenue it collects, and it is for councils to apply rates reductions, on top of existing statutory reliefs, as they see fit.

"Individual business rate payers can appeal their valuation via independent processes if they feel it is incorrect."

He added: "The Scottish government remains committed to supporting the economy in the north east.

"The Scottish government's actions on business rates already mean that around 8,000 businesses in Aberdeen city and shire will pay no rates next year and 400 businesses have been taken out of the Large Business Supplement."

The Scottish Conservatives recently called for an "immediate review" of the business rates revaluation after firms raised concerns about tax increases.

In January, it was claimed planned business rates increases could cripple parts of Scotland's hospitality industry.

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