Sporting Rates funds: FOI release

Information requested

"1. Are 100% of the sporting rates funds collected by local authorities and handed to the Scottish Government distributed back to councils? If not, how much is, where is this money going?

2. Are the funds divided and distributed to councils proportionally to the intake from Sporting Rates per council? For example, if one council took £100,000, and another £0, would they receive the same amount back or a sum which is in some way proportional to their contribution?

3. If not by proportion of collection of Sporting Rates, how are the funds divided?”

Response

The answer to your question is as follows:

We have taken your reference to ‘sporting rates’ to refer to Part 6 of the Land Reform (Scotland) Act 2016 which provides for the valuation of shootings and deer forests by the assessors in Scotland who undertake the valuation of non-domestic properties for the purposes of levying non-domestic rates (NDR). Sporting rates are non-domestic rates levied on shooting rights and deer forests, and as such are treated as part of NDR income as a whole within local government finance arrangements.

Local authorities retain every penny of the NDR income collected for non-domestic properties in all sectors in their area. The Distributable Amount (DA) of NDR income is set with reference to the forecast NDR income to be collected for the year, the accumulated balance on the NDR account and the overall financial outlook for the Scottish Government. At the start of each financial year, each local authority forecasts a “Provisional Contributable Amount” (PCA) to the Scottish Government which is an initial estimate of the NDR income, equivalent to the gross amount of NDR paid by ratepayers, net of any reliefs which are funded by the Scottish Government.

The PCA is notionally pooled and then redistributed to councils as the DA. This information is updated throughout the financial year including a Mid-Year Estimate, a notified return after the financial year with provisional outturn data and an audited return following a review by external auditors. Any changes from the PCA reported to the final outturn contributable amount in any year is accounted for in the calculation of future years’ DAs.

The Scottish Government continues to guarantee each council’s share of the total level of funding provided through a combination of NDR income and General Revenue Grant, any decrease in the amount of NDR income collected is compensated for by a corresponding increase in General Revenue Grant, and vice versa.

The NDR income is effectively pooled, however in order to avoid unnecessary transfers between the Scottish Government and local authorities – only net payments are made. Further information is available in section 2.3.2 (Non-Domestic Rates) of the most recent Scottish Local Government Finance Statistics publication for the 2022-23 financial year.

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