Exclusive:Businesses warn they will 'bleed to death' because of SNP's 'Victorian-era taxation policies'

Businesses all across Scotland are receiving their new business rates revaluations, with many say they are having to consider closing their doors for good because they cannot afford the new bills. While the extension of rates relief in recent weeks has been welcomed, business leaders say it is “simply putting off an inevitable reckoning”.

One of these business owners is Gordon Drummond, who runs Cairngorm Lodges in Aberdeenshire.

He is facing a 185 per cent increase in his business’ rateable value. However, this takes him over the threshold for the small business bonus relief, which he said means the true number is closer to 620 per cent.

Mr Drummond said this will be “fatal” and will cause his business to “bleed to death”. He added that any transitional relief on offer would only delay closure as it is “a sticking plaster applied to an arterial wound”.

Speaking to The Scotsman, he said: “This is massive and will kill my company.

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“The new budget deal means the damage is limited to just 15 per cent of the total impact, but while that has helped, the rateable values are still hanging over my head like the sword of Damocles.

“It was only five years ago that I got planning permission to do this, and that permission is for holiday properties only.

“What this means, is that if the government successfully puts me out of business, I will have to apply to the council for a demolition licence to plough my investment back into the ground.

“I would have to destroy it because even if it was non-operational, it would still be a business with a rateable value.

“The emotion of building something for 15 years and then having to give the instruction to destroy it because you can’t afford to keep it open is devastating.”

Mr Drummond said the alternative would be increasing his prices by a third just for the business to stand still, which would make it "non-competitive or so expensive that customers are better off travelling to Europe”.

He added: “This situation is profoundly distressing and frankly absurd. I do not believe this is the type of business that the Scottish Government intends to destroy.

“The consequences of forcing viable, sustainable, rural businesses into administration and forcing them to literally plough themselves into the ground is ludicrous.

“The approach feels antiquated, reminiscent of Victorian-era taxation policies where owners removed roofs from country houses to avoid tax.”

Mr Drummond wants the Scottish Government to “pause and rethink” the rates revaluation as it is causing business owners an “unfair and unacceptable level of stress”.

Katie Long, who runs Brown and Blacks pub in Scone, is also facing similar worries.

Last week, the brewery told her that her rateable value will increase from £19,900 to £52,700, which she says is the “last straw” for her business.

She said: “I’m considering putting in my notice to the brewery which would put people out of work, harm our community and deprive the government of revenue.

“The thought of shutting the door for good makes me sick.”

She added: “Yes, rates’ assessors are independent, but the government should halt these sky-high revaluations and give meaningful support.

“It feels like the weight of the world is on my shoulders because I’ve got 26 staff who I feel responsible for, but I don’t know how much longer I can keep fighting.

“We’ve created a great community pub with fantastic regulars, we hold gala days, coffee mornings, French lessons for elderly residents, and sponsor a local kids’ football team.

“We are busy but it’s just not enough anymore.”

Both Ms Long and Scottish Conservative leader Russell Findlay have asked First Minister John Swinney to visit the pub to hear more about the impact the rates revaluation is having on business owners.

Mr Findlay said: “Katie has built an incredible community business from scratch, but her crippling new rates bill could force her to call last orders for good.

“This would be a tragedy for a community in John Swinney’s own constituency and would result in more than 20 people losing their jobs.”

He added: “Katie understands that it’s the independent assessors who conduct the new rates revaluation which are causing chaos and concern across Scotland.

“But Swinney’s SNP government can and must step in to ensure that businesses like Katie’s get meaningful support and that Scotland’s broken rates system is fixed.

“The SNP think they can keep turning the screw on hard-working Scots, but their reckless and short-sighted anti-business approach is wreaking devastation.”

The Federation of Small Businesses (FSB) said many of their members are being hit by “significant rises” in their business rates which is leaving them facing “very difficult choices”.

Colin Borland, Scottish director of the FSB, said: “It is a story we are hearing again and again, from the local sports shop which is shelving plans to take on an extra member of staff and the neighbourhood café which is being forced to let staff go, to the local gym which is wondering whether it will still be open come the end of next year.”

Research by the FSB suggests more than a third of Scottish businesses expect to shrink or close in the next 12 months. This is compared to just one in five who are predicting growth.

Mr Borland added: “The rates relief that has been extended in recent weeks has helped ease some of that pressure, but for most businesses it is simply putting off an inevitable reckoning rather than taking the problem away.

“That is why we are calling on all of Scotland’s political parties to commit to continuing the ‘lifeline’ small business bonus scheme and to review eligibility thresholds to ensure it continues to support small businesses as it was designed to do.”

The SNP’s Finance Secretary Shona Robison will ask MSPs to pass her 2026/27 budget at stage three on Wednesday afternoon.

A spokeswoman for the Scottish Government said the proposed budget has a “strong” non-domestic rates package, “including more than £320 million of forecast support through transitional relief schemes” over the next three years.

They added: “Recognising the challenges faced by licensed hospitality, we have offered an additional 25 per cent relief for eligible licensed premises and music venues liable for the basic or intermediate property rates, capped at £110,000 per business per year.

“This takes the total relief for eligible licensed premises and music venues to 40 per cent for the next three years, capped at £110,000 per business per year.

“Thanks to our generous non-domestic rates relief package, we estimate that 96 per cent of retail, hospitality and leisure businesses could benefit from some form of relief in 2026/27.”