UKHospitality Scotland is urging the Scottish Government to reassess its approach to business rates relief after recent Budget measures left thousands of hospitality venues at a disadvantage compared to their English counterparts. The trade body has voiced concern that the current relief structure entrenches an ongoing competitiveness gap between hospitality sectors north and south of the border.

According to UKHospitality Scotland, more than 2,500 businesses have been left without financial support due to the criteria set out in the Scottish Budget announced in December. While the measures offered some relief, the organisation says they fall short of what is needed to help the sector thrive amid rising costs and post-pandemic recovery pressures.

Relief cap leaves thousands without support

Under the current Budget plan, hospitality venues in Scotland with a rateable value of up to £51,000 are eligible for 40% business rates relief. However, this falls significantly short of the threshold set in England, where the same 40% relief extends to properties valued up to £110,000.

The lower cap means a substantial number of Scottish businesses miss out on vital support, with UKHospitality Scotland estimating that more than 2,500 venues have been “put on ice” by the decision. These businesses, many of which fall just above the threshold, are now left to shoulder the full financial burden during an already challenging economic period.

UKHospitality Scotland’s Executive Director Leon Thompson said there had been “enormous optimism” when the Budget was first announced. However, the optimism quickly gave way to frustration as it became clear that the measures would leave many venues excluded. “This imbalance has been the thorn in the side of Scottish hospitality for several years,” Thompson stated, emphasizing the need for parity with the support extended in England.

Sector competitiveness at risk

The disparities in business rates relief have raised broader concerns about the long-term competitiveness of the Scottish hospitality industry. According to UKHospitality Scotland, the current system risks discouraging investment and growth in the sector. Businesses operating close to the relief threshold may find themselves penalized for success, while others may hesitate to expand due to the financial implications of higher rateable values.

This uneven playing field not only puts Scottish businesses at a disadvantage but could also lead to stagnation in a sector that is vital to the country’s economy and tourism. Hospitality businesses across Scotland, from rural inns to urban restaurants, contribute significantly to local employment and community engagement. Without appropriate financial support, many of these businesses face an uncertain future.

UKHospitality Scotland is now calling on the Scottish Government to rethink its approach and align more closely with the model used in England. The group argues that increasing the eligibility threshold would provide a more meaningful boost to a struggling sector and signal a commitment to long-term industry sustainability.

Calls grow for policy alignment with England

As the debate over business rates relief continues, pressure is mounting on the Scottish Government to make changes that reflect the realities facing hospitality businesses today. With energy costs, staffing shortages, and inflation still affecting bottom lines, industry leaders argue that targeted support through more generous relief policies is essential.

Leon Thompson and UKHospitality Scotland are not alone in their concerns. Across the sector, there is growing consensus that alignment with England’s relief model would provide much-needed parity and encourage business confidence.

While the Budget announcement was initially welcomed by many, the subsequent disappointment over its limited scope has reignited discussions about how best to support the hospitality industry in Scotland. The coming months may prove crucial as businesses await further decisions that could shape the sector’s recovery and growth prospects.

For now, UKHospitality Scotland continues to advocate for a more inclusive and impactful relief strategy—one that reflects the true scale of the challenges facing the hospitality industry and offers real solutions to help businesses thrive.