Small Business Bonus Scheme Evaluation Short-Term Working Group minutes: September 2022

Attendees and apologies

• Federation of Small Businesses
• Booksellers Association
• Institute of Revenues, Rating and Valuation
• Scottish Grocers Federation
• Association of Convenience Stores
• Scottish Property Federation
• Association of Scotland's Self-Caterers
• Scottish Licensed Trade Association
• Scottish Government

Apologies

• Confederation of British Industry (Scotland)
• Convention of Scottish Local Authorities
• Institute of Chartered Accountants of Scotland
• Scottish Chambers of Commerce
• National Hair and Beauty Federation

Items and actions

Minutes of last meeting

The chair welcomed the group to the meeting and apologies were noted. 

The minutes of the previous meeting of 30 June 2022 were agreed. It was explained that these and minutes of future meetings once agreed, would be published on the Scottish Government website. It was proposed that the group would not produce a formal report.

Collecting new information and avoiding additional burdens

The chair noted that this meeting was an opportunity for further discussion on information that might be collected from businesses while avoiding additional burdens.

The Scottish Property Federation noted that businesses are already asked for a vast amount of information, and it is not always clear to businesses how the data they provide benefits their day-to-day business. It suggested that the process of providing information should be made easier, including information provided for the purposes of valuing non-domestic property, and asked whether data from other sources, e.g., Revenue Scotland, could be used to improve datasets.

The Booksellers Association noted that any additional burden on businesses should be carefully considered when many businesses currently have other priorities such as meeting energy costs.

The Scottish Grocers Federation also highlighted the costs that retailers are currently facing and that any changes to the Small Business Bonus Scheme (SBBS) or to information requests should be proportionate and not overly complicated. It also stated in their view that that SBBS should not be subject to any conditionality and that SBBS was “vital” to business survival at the moment.

The Association of Scotland’s Self-Caterers stated that SBBS was “critical” for their members and that this sector was already facing a lot of new legislation. It also noted that additional information would be collected through the short-term lets licensing scheme.

The Scottish Licensed Trade Association noted their agreement with the points raised, and with anticipated winter closures stated that there may be an additional issue with collecting data from those businesses. The hospitality industry needs support and, in their view, SBBS should be expanded

The Institute of Revenues Rating and Valuation (IRRV) noted that councils and assessors collect different information, and it may be useful to invite Scottish Assessors to a future meeting. They further noted that while data sharing occurs, data from some organisations can be hard to access.

The Scottish Government advised the group that it uses available administrative data with a view to improve business data and linkages. The difficulty in accessing HM Revenue and Customs data was noted. The Scottish Government also stated it continues to work with the Office for National Statistics regarding the building of a UK Business Index and a replacement for the Inter-Departmental Business Register (IDBR).

What is (and is not) a small business? 

Participants were advised that given non-domestic rates is property, rather than business-based tax, the purpose of this agenda item was to consider how small business might be best identified i.e., what is a small business?

The Scottish Property Federation suggested that rateable values can be a blunt tool and for some sectors where rateable values are based on turnover, such as hospitality, an otherwise ‘small business’ may not qualify for SBBS. It noted that SBBS relief takes 100,000 properties out of non-domestic rates (NDR), and a small payment from these would help contribute to local services.

The Scottish Licensed Trade Association explained that in the hospitality sector, turnover may have increased, but costs have also increased so overall profitability is down.  They did not endorse the suggestion that ‘all businesses pay something’ towards NDR.

The IRRV explained that moving away from SBBS eligibility being based on rateable values, or introducing a charge for all ratepayers for instance, would add complexity to the administration of the relief. However, it noted that a small charge may help address any misconception that those in receipt of 100% relief are not liable for rates and ensure that information held is up to date - in Fife Council, there were over 800 NDR liability changes as a result of the COVID-19 business support grant schemes. It highlighted that property descriptions on the valuation roll don’t always relate to the business activity that takes place on the premises and this would need to be considered if SBBS eligibility was amended and, for instance, based on property type. They also noted COSLA’s position that NDR should be devolved to local authorities entirely. 

In respect of types of SBBS beneficiaries, the IRRV noted that this can include some public sector or health and medical premises and queried whether public sector properties should be excluded from SBBS. The Scottish Government noted that the public sector flag on the valuation roll was not always accurate and such a change could add to the data and admin burden associated with SBBS.

The Scottish Government advised that any change to SBBS eligibility may require additional information to be collected but noted that there would need to be a balance to ensure it’s not an unnecessary burden. 

Date of next meeting 

The chair noted that draft minutes would be circulated for agreement, and the date for the next meeting would be circulated in due course.