With the Scottish budget looming, leaders across retail, hospitality and tourism are calling for targeted measures to alleviate financial pressures and support the sectors' recovery amid rising costs and regulatory demands.
Stuart McCallum, head of consumer markets in Scotland at RSM UK, highlighted the strain on businesses due to increasing costs from regulations, employers’ National Insurance hikes, and the persistent burden of business rates. He warned that without intervention, these challenges could force businesses to pass costs onto consumers or face unsustainable employment costs.
“A permanent lowering of the [business] rate would not only ease the burden on retailers and hospitality operators, but offer a competitive advantage against counterparts across the rest of the UK,” McCallum said.
He also urged the Scottish government to reconsider income tax policy, warning that higher tax rates could drive talent away and reduce consumer spending.
“They could even go a step further and increase income tax thresholds in line with inflation, particularly to relieve financial pressures on lower and middle income earners. With increased consumer confidence comes an increase in spending, which the industry would hugely welcome,” McCallum added.
David Lonsdale, director of the Scottish Retail Consortium, said the budget should be “unambiguously pro-business” to ease burden on the retail sector which is in a precarious state.
“Economic growth is weak, retail sales are flatlining, and shopper footfall has fallen. This reinforces the need for an unambiguously pro-business Scottish Budget which injects much needed confidence into the economy, prioritises competitive taxes, and which avoids piling extra costs onto retailers who are still reeling from the chancellor’s increase to employers’ National Insurance contributions,” Lonsdale said.
Marc Crothall, chief executive of the Scottish Tourism Alliance, echoed the need for urgent financial relief.
“Tourism and hospitality businesses are telling us loud and clear they need to see measures that will immediately ease the financial burden on them and that will directly support the sector to grow and be more competitive,” Crothall added.
“The tourism and hospitality sector has felt overlooked in recent years as a key economic driver. We must see a budget that protects, restores and invests to have long-term success.”
The Scottish budget for 2025 to 2026 will be presented on 4 December.
