Taxing big stores won’t save small shops

“It is only fair that the largest, profitable businesses make a greater contribution and if this helps sustain businesses in many of our town and city centres that is an added advantage.”

That was Scotland’s finance secretary John Swinney speaking last month when he announced plans to impose £30m of extra business rates on major retail stores. He portrayed it as a tax on out-of-town superstores and help for high streets.

Now it’s clear it’s really just a tax rise in search of a justification.

It would impose an extra levy on all stores with a rateable value more than £750,000.

So not just suburban supermarkets. Not just premises on retail parks but a whole range of big shops including stores on Edinburgh’s Princes Street and Buchanan Street, Glasgow.

Members are telling us the proposals, which came without consultation or warning, are a severe blow to the relationship between business and the Scottish government.

Of course, we appreciate the government faces difficult choices. We accept we all have to make a contribution but this isn’t sharing out the pain. It’s bashing a small number of key businesses very hard. And it would do nothing to help high streets. In fact this new tax would make things worse by endangering existing town centre investment plans.

At a time when private sector growth is needed more than ever to generate jobs that can replace those lost in the public sector, this counter-productive levy would penalise business expansion and act as a disincentive to companies considering new stores in Scotland.

Faced with such an unsympathetic business environment, retailers are more likely to take their money and jobs elsewhere.

The Scottish Retail Consortium, part of the British Retail Consortium, is working tirelessly to get these plans blocked. With our members, we’ve set up a new business-wide campaign group - Competitive Scotland. We’re working with opposition MSPs. We’ve given evidence to the parliamentary committee. This levy needs to be seen for what it really is.

Things are moving fast. It could be that by the time you read this the committee has voted to annul the levy and take it to a vote in parliament next week. Westminster needs to watch - and take notice.

The Prime Minister has been happy to stand alongside major retailers and trumpet their creation of thousands of new British jobs, but the support promised for private sector growth must amount to more than PR opportunities.

The Budget, the next minimum wage decision and how the localism agenda is implemented are among the next key tests.

John Swinney is not alone in misunderstanding the huge ‘contribution’ retailers, and not least the ‘largest, profitable’ ones, already make.

To all politicians I say, the way to produce more small retailers is not to take big ones and shrink them.

Stephen Robertson Director-General, British Retail Consortium