SNP, Green government rates grab will 'penalise' Scots

It comes after rates relief powers were passed to councils by the Scottish Government, giving discretion over rebates for empty historic and business properties and vacant.

It is claimed not enough information has been available on the changes which have been described as a "rates grab" by one expert, and a townhouse-sized building could see a "sudden new rates liability" of between £35,000-£50,000.

Already the big councils are going wholeheartedly in.

City of Edinburgh Council, which said it contacted all those in receipt of relief to let them know of the changes which start on April 1, also said vacant land would receive "standard empty property relief" of 50% for three months.

In the Scottish capital, the 1800 empty properties gives the potential to raise over £13.8m.

Glasgow City Council is a gradual diminution moving to 100% relief for three months and then 10% for the next 12 months then none. It also covers all empty property including vacant land and listed and heritage buildings, and is budgeted to generate an additional income of £12.7m in the next year.

Rates relief on such properties will reduce to zero in Glasgow (Image: Getty Images)
Tim Bunker, business rates specialist at Graham + Sibbald also told The Herald: "Many of the property-owners that ‘protect’ the country’s building heritage look set to be penalised, under the latest changes to the rating system.

"Through these changes, the Scottish Government is passing autonomy on rates relief to each local council and many cash-strapped councils have already decided to remove relief on historic buildings, due to funding restrictions which they say are imposed by the Scottish Government.

"Historically, listed buildings were exempt from business rates when vacant. The purpose of this relief was to act as a contribution towards the high holding costs of vacant listed buildings due to higher insurance, maintenance and utility costs, as these buildings must be heated and secure when empty.

"The potential uses of historic buildings are often limited to office or residential and when those markets are ‘quiet’ many buildings remain vacant for long periods.

"Given the nature and complexity of these buildings, there can also be significant planning delays for changes of use, which can further extend the period of vacancy. 

"There has been very limited notification on this change with the heavy sound of the rates invoice on the mat being the first communication many historic property owners will receive."

READ MORE: SNP, Green homes law does ‘incalculable damage’ to economy

On vacant land, he said: "The subjects covered will include land used for a non-domestic purpose, land awaiting development, brownfield land and undeveloped land including a greenfield site.

"In addition to the land value assumed value of lighting, fencing, CCTV cameras and monitors, and sustainable drainage systems can be added.”

"Many councils are yet to provide confirmation but the majority so far are removing rates relief from listed buildings and vacant land,” Mr Bunker said. "The main issue is that land already valued in the Valuation Roll will receive bills from 1 April 2024 with no right of appeal.

"These sites were valued as from 1 April 2023 but because there was no liability the owners will not have bothered to appeal. However sites that are valued by Assessors, after 1 April 2024 – due to this change in liability – will have four months to challenge."

The potential net increase in billable liability for these properties is estimated at over £13.8m (Image: Getty Images)

A spokesperson for City of Edinburgh Council said: "It’s about enhancing communities, stimulating the economy, and putting underused buildings to better use.

"Some of these properties have been empty for years and under the current regulations owners haven’t had to pay rates.

"Initial awareness was raised in the business community prior to the devolvement of powers to Local Authorities … we updated current empty property relief recipients in December 2023 to advise what was happening. Throughout this change, colleagues have actively raised awareness through their network of contacts."

A spokesman for Glasgow City Council said that "across Scotland, towns and cities are using the flexibility introduced by new national regulations to establish financial incentives for owners to bring vacant property into active use, including long-term vacant property which can blight streets and neighbourhoods".

The spokesperson added: "In Glasgow, it is anticipated that standardising empty property relief and removing indefinite awards can also support other key city initiatives, particularly in the city centre – for example, converting the upper floors of commercial buildings into new homes."

A Scottish Government spokesperson said that devolving the power to councils "allows local authorities to tailor any support for unoccupied properties, to reflect local needs and circumstances", adding: "The Scottish Government is committed to undertaking an initial review of the devolution of empty property relief before the next revaluation in 2026."

Elsewhere, business editor Ian McConnell dissected Prime Minister Rishi Sunak's speech at the Business Connect conference at the Manufacturing Technology Centre in Coventry this week.

"To say it was uninspiring would be a gentle euphemism," he writes. 

"Mr Sunak talked about the 'promise of entrepreneurship' and conceded this had 'come under strain'.

"Apparently, however, that has been in no way the fault of the Tories."

Business correspondent Kristy Dorsey writes in her Business Voices column this week that "Government appears to be giving up on older house buyers".

She writes consequences "will be severe for burgeoning generations of retirement-age renters who will become increasingly dependent on public spending".

"Less attention has been given to the long-term impact of an increasing number of people forced to wait until later in life to buy a home."

Also this week, deputy business editor Scott Wright celebrates a series of whisky wins for Scotland but warns that "there is a potential danger lurking, with the Scottish Government poised to bring forward fresh proposals to regulate alcohol advertising and marketing in Scotland".

"First Minister Humza Yousaf has pledged that the revised recommendations will be based on 'targeted engagement'."