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CBI responds to ‘alarming’ Scottish Spending Review

Thursday September 22nd, 2011

CBI Scotland has issued a mixed response to the Scottish Government’s Budget and Spending Review.

CBI Scotland’s Director, Iain McMillan, said it was encouraging that ministers had sought to protect and where possible enhance capital spending ‘on important infrastructure projects’.

However, he added that the proposals for business tax rises were ‘alarming’.

He said: “Following last year’s removal of transitional rate relief, it is alarming that the Scottish Government is proposing two business tax rises, a business rate levy on large retailers, who sell tobacco and alcohol products, and an apparent reduction in empty properties rate relief. The re-emergence of the retail levy was absent from the SNP manifesto and we consider its reappearance a fundamental breach of the commitment to poundage rate parity. Also, industrial and commercial buildings are rarely left empty by choice, particularly when they don’t generate an income, and a tax rise on empty properties could see new developments curtailed. If the Scottish Government can’t be trusted on business rates, what would they do with powers over Corporation Tax, were that tax to be devolved?

“The Scottish Government also appears to be in denial with regard to the dire state of the UK public finances. The UK’s structural deficit must be reduced quickly along with the rising annual interest bill on the national debt. The Scottish Government appears to be quite content to see the UK’s public finances deteriorate further than planned and this is not a credible position to take.”

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