Katy Dickson
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Katy Dickson
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Our review of the review…..

In 2016 the Barclay Review Group was tasked to conduct a review into the non-domestic rates system in Scotland, which it published in August 2017. This may not be the most thrilling blog topic but it is likely to impact all businesses in Scotland so is worth understanding.

The Review presented 30 recommendations. Below I summarise my initial reaction to some of the recommendations.


A significant proportion of the recommendations are related to ratings administration. The recommendation for three yearly revaluations with one year between valuation dates and valuation notices is welcome. This should reduce the current issue of valuations being out of touch with current market conditions. A more consistent and transparent system which is clearer for ratepayers is crucial to build trust in the system. Recommendation 15, which is to incentivise ratepayers to use online billing, is concerning as there is a proportion of society who cannot access or use this method and they should not be disadvantaged.


The headline recommendation for the reform of the appeals system is acceptable – more transparency and a quicker appeals process are much needed. However, the detail of the recommendation may not speed up the process and the suggestion that an appeal fee should be considered to cover the structural change is not supported. It is disappointing there is no recognition of the burden of paying the incorrect rate while the appeal is outstanding for significant periods of time.

Rates Avoidance

The Review is clear that avoidance of rates is unacceptable. Creating a civil penalty to replace the rarely used criminal penalty for withholding information should help to reduce the number of ratepayers avoiding the roll. It was surprising not to see a recommended extension to the current 14-day period ratepayers must return their form. If a civil penalty is to be enforced for late return of forms, the return period must be reasonable. Holiday lets came under fire in this section too. Taxation for this sector should be consistent and it must be ensured that measures intended to help a localised situation are not applied nationally to the detriment of areas where support rather than burden is required.

Small Business Bonus or Town Centre Bonus?

There is a focus on support for town centres. It is recommended Fresh Start Relief, which offers discounted rates for new occupants of previously empty properties in town centres, is extended. Of greater concern is the recommendation that the Small Business Bonus Scheme should be evaluated. It is suggested that we should consider following the Northern Irish model where the Relief Scheme is targeted at town centres. While I appreciate the need to support struggling high streets this should not be to the detriment of supporting rural subjects.

Empty Properties

Understandably the Review discourages empty properties. The recommendations to support this policy include that only properties with over 51% occupation will be eligible for reliefs, and empty property relief on listed buildings should only last two years. I don’t see how the 51% will be reliably measured and there is a lack of appreciation that listed buildings often need sensitive renovations requiring permissions and skilled trades – this may take more time to complete than the renovation of a non-listed building. Some flexibility is required. The Review recommends extending Fresh Start Relief which currently applies to town centre properties which have been empty. The extension would be both in terms of relief period and to include all listed buildings regardless of the location.

Large Business Supplement and Business Growth Accelerator

Bringing the supplement paid by higher ratepayers back in line with England will help with competitiveness. The recommendation for a Business Growth Accelerator whereby rates are not increased for a year following property expansion or improvement is welcome, but may not make a significant difference.


One recommendation is for all exempt property, including agriculture and forestry, to be included on the valuation roll and 100% relief applied. I see no benefit in doing this. It adds administrative costs and increases uncertainty. A relief, when compared to an exemption, can be more easily removed with less parliamentary scrutiny. Interestingly, the report does not consider sporting rates although does, in passing, incorrectly refer to them as rates on sporting estates. Is this another indication the Review has failed to appreciate the rates pressures in rural areas?

Plant and Machinery Order

I am pleased for the recognition that the Plant and Machinery Order needs to be reviewed and, in its current form, is not fit for purpose for some renewable energy schemes. While I agree with this, the industry cannot wait several years for another review. The small hydro sector is currently fighting for the change to remove the anomaly which has resulted in disproportionately high rateable values. An interim relief is available but this is due to end in the spring – we need change now to save the industry from the cliff edge.

Although generally welcome, the Review brings several uncertainties and leaves a significant amount of further evaluation and consultation to be carried out by Scottish Government. If it took the Barclay Review a year to reach this point I’m not sure how they expect Scottish Government to achieve significantly more in significantly less time. I look forward to the Scottish Government response.

The full report is available here www.gov.scot/Resource/0052/00523643.pdf.

Katy Dickson, Senior Policy Officer (Property, Business and Connectivity)



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