Retailers in Scotland face “formidable challenges” next year as rising inflation and costs are set to bite, a trade body has warned.

Scottish Retail Consortium director David Lonsdale said his members continued to “grapple with a hotchpotch of government-imposed cost pressures”.

He flagged that council tax rises were likely to squeeze consumer spending.

Large retailers will also face the added pressure of paying out for the government’s Apprenticeship Levy.

Retailers south of the border are facing many of the same threats to business in 2017.

Lonsdale urged a “more coherent” approach to policy-making.

In his New Year message, he said: “In many respects our economy lives or dies by what happens to consumer spending.

“That’s why policy-makers should be concerned about the formidable challenges for Scottish retail in the year ahead.

“Rising inflation and council taxes are likely to put a strain on disposable incomes.

“However, households will be relieved by the Scottish government’s decision not to increase income tax rates, an area on which the Scottish Retail Consortium and government are firmly at one.”

Lonsdale also called for a shake-up of business rates to ease the burden.

A Scottish government spokesman said it has already done plenty to help retailers. “The Scottish government is doing everything within our powers to support our economy and we welcome the recent uplift in retail sales in Scotland,” the spokesman told the BBC.