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Rates relief reform could bring 5000 empty business properties back to life

The Scottish Government is reforming the rates relief that vacant business premises are eligible for.

Vacant: Empty properties are bad for the area, residents say.
© STV

More than 5000 empty business properties could be brought back to life as a result of a planned shake-up of rates relief, the local government minister has said.

The Scottish Government is reforming the rates relief that vacant business premises are eligible for.

Ministers believe the changes could bring up to 5500 empty properties back into use, helping to regenerate the country's town centres.

They also say changing the subsidy for empty premises will raise about £18m a year from 2013-14 onwards.

At the moment, commercial properties get 100% rates relief for the first three months that they are empty, with 50% off rates bill after that.

The Scottish Government proposes to change the system so that while businesses will still get 100% rates relief for the first three months that a property is vacant, after this period they will only get a reduction of 10%.

Under the current set-up, providing rates relief for empty business properties would cost £757m over the period 2010 to 2015, with the Scottish Government stating the planned changes would reduce this to £721m.

But the Scottish Council for Development and Industry has already warned the plans could have a "negative economic impact".

Meanwhile, leading commercial estate agency Colliers International claimed the change could "do more damage than good".

Local government minister Derek Mackay said he would continue to listen to the views of others about the proposals, but insisted the current system was "not working for our communities".

Mr Mackay will tell MSPs on Holyrood's Local Government Committee about the reforms tomorrow.

Speaking ahead of that, he said: "The Scottish Government and our enterprise agencies are working tirelessly to ensure Scotland retains its reputation as the most competitive place to do business in the UK - an important part of this is reviewing our business rates to reflect the current economic challenges and opportunities.

"The current system of empty property relief is not working for our communities and we recognise there is a need to incentivise owners of business premises to find occupants - not to keep the shop doors shut.

"Through working with stakeholders across the business community, we plan to introduce new incentives which will revitalise our town centres and potentially bring up to 5,500 vacant business properties back into use."

He added: "In these tough economic conditions, it is important that business rate reliefs maximise opportunities to create sustainable economic growth and allow Scotland to retain its position as the most supportive business environment anywhere in the UK."

Mr Mackay also stressed: "This Government is focused on supporting Scotland's business community.

"We have retained the small business bonus scheme, which has either eliminated or substantially reduced business rates for two out of every five commercial properties in Scotland.

"Even after proposed reform, empty property relief will remain significantly more generous than that offered in England and Wales."

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