Scotland business

Retailers attack health levy plan

bottles of wine on supermarket shelf
Mr Swinney said the levy would only affect "the very largest" retailers in Scotland

Scottish retailers have branded a proposed retail tax as an "unjustifiable raid" on their coffers.

The Scottish Retail Consortium's (SRC) comments followed a meeting with Finance Secretary John Swinney.

SRC said it was disappointed ministers had ruled out a full impact assessment of a planned public health levy on large retailers of alcohol and tobacco.

But Mr Swinney said the levy would only affect "the very largest" retailers in Scotland.

The Scottish government plans to use the levy to tackle the cost of problems associated with drinking and smoking.

The tax would be raised via a business rates supplement from April next year.

Ministers expect to raise £110m from the supplement over next four years.

Following the meeting with Mr Swinney - which was also attended by a range of business organisations - SRC said it believed the levy was "simply a revenue-raiser dressed up in the guise of public health".

Jane Bevis, from SRC, said: "The Scottish government has a hole in its local authority budget and has chosen the retail sector to fill it, simply because supermarkets are profitable businesses.

"The public health justification for this levy is completely unfounded. The Scottish government clearly has no intention of changing consumer behaviour by involving the wider alcohol and tobacco supply chain."

She added: "The finance secretary has talked about raising funds for preventative health measures but will be funnelling money from this tax direct to local authorities which will spend it however they see fit."

'Serious omission'

CBI Scotland said the Scottish government's refusal to publish a full impact assessment was "a serious omission".

Assistant director David Lonsdale, who attended the meeting, added: "This new £110m tax will discourage investment and job creation and harm Scotland's reputation as a place which welcomes commercial investment.

"It is astonishing that ministers are refusing to publish a full and frank assessment on the direct and wider implications of this new tax on business."

Mr Swinney said: "In the spending review we announced plans to introduce the public health levy, which will only affect the very largest retailers in Scotland.

"We estimate the levy will raise £30m in 2012-13, equivalent to just 0.1% of retail turnover in Scotland.

"Given the significant cuts from Westminster, this will be used to contribute towards the preventative spend measures that will be taken forward jointly with the Scottish government, local authorities, the NHS and the third sector."

Mr Swinney said he told business representatives at the meeting that he intended to lay legislation setting out full details of the levy in the new year.

He added: "I also confirmed that the supplement will apply at a set rate across all retail properties with a rateable value of over £300,000 and will only impact on a very small number of large retailers.

"The draft budget is a consultation document and we welcome all contributions on these proposals and will continue our engagement with retailers on taking our plans forward."

More on this story

Related Internet links

The BBC is not responsible for the content of external Internet sites