Independent retailers in Scotland are seeking greater business rates relief ahead of the December Budget, warning that differences in support across the UK are increasing pressure on high street shops.

Scottish independent retailers are calling for business rates cuts ahead of the Scottish Government's Budget on 3 December 2026, warning that differences in tax relief across the UK could put their shops at a competitive disadvantage.

The British Independent Retailers Association (Bira) says new support measures in England and Wales could increase the cost gap between Scottish retailers and businesses elsewhere in the UK.

The appeal follows the UK Chancellor's Autumn Budget, which announced further business rates relief for eligible retail, hospitality and leisure properties in England from April 2027.

Under the measures, properties with a rateable value of up to £18,000 will qualify for full relief, compared with the previous £12,000 threshold. Partial relief will extend to properties with a rateable value of up to £21,000.

Rateable value is an estimate of a commercial property's annual rental value and is used to calculate business rates, a tax on most non-domestic premises.

The UK Government estimates that the changes will exempt around 70,000 additional businesses from paying business rates. Other qualifying retail, hospitality and leisure properties will receive a two-year freeze on rates bills in real terms, meaning bills will not rise faster than inflation.

The measures follow the introduction of permanently lower business rates multipliers in England in April 2026 for eligible retail, hospitality and leisure properties with a rateable value below £500,000.

Wales has also introduced a lower business rates multiplier for shops with a rateable value below £51,000, creating further differences in the property taxes paid by retailers across the UK.

Scottish shops face rising cost pressures

In Scotland, eligible retail, hospitality and leisure properties receive a temporary 15% reduction in business rates, subject to a cap.

The Small Business Bonus Scheme provides further relief for qualifying smaller properties, although full relief generally ends at a rateable value of £12,000.

Bira argues that these arrangements are less generous than the support available in England and Wales, adding to the costs faced by Scottish independent retailers.

Andrew Goodacre, chief executive of Bira, said: "Once again the Scottish Government has failed to create a level playing field for retailers in Scotland compared to the rest of the UK."

Goodacre said the lack of equivalent business rates discounts made operating physical shops in Scotland more expensive, placing independent retailers at a disadvantage.

The association also highlighted competition from online businesses, which do not face the same property costs as retailers operating high street stores.

Bira warned that business rates, alongside employment and energy expenses, could place further pressure on the financial viability of independent shops.

Store closures raise high street investment concerns

Retailers have also raised concerns about the effect of business rates on store closures, employment and investment in Scottish town centres.

Karen Forret, president of Bira and managing director of Scottish retailer Wilkies, said shops in England and Wales had repeatedly received more favourable business rates support than those in Scotland.

She questioned whether investment in town centre regeneration could succeed without sufficient support for the independent businesses expected to occupy retail premises.

Forret said Wilkies had faced difficult decisions to close some stores while keeping others open because of its commitment to local high streets and the jobs they support.

She argued that retailers continuing to invest in Scottish communities should receive support comparable to that available elsewhere in the UK.

Bira said the financial pressures were particularly relevant to retailers operating several stores or occupying properties that do not qualify for the highest levels of business rates relief.

The association warned that continued differences in tax support could affect decisions about keeping stores open, expanding into new locations and refurbishing existing shops.

Scottish Budget brings opportunity for rates reform

Bira is urging the Scottish Government to use its 3 December Budget to introduce larger and longer-lasting business rates reductions for independent retailers.

The association wants Scotland's system to offer support more closely aligned with England and Wales, reducing property costs for businesses operating in town and city centres.

It argues that lower rates bills could help retailers retain staff, maintain existing shops and invest in their premises.

Scotland already provides business rates relief through the Small Business Bonus Scheme and targeted support for eligible retail, hospitality and leisure properties. However, Bira maintains that further changes are needed to address differences in the support available across the UK.

The calls come as governments seek to balance revenue from commercial property taxes with measures to support physical retail and reduce empty high street premises.

The December Budget will set out whether the Scottish Government plans further changes to business rates relief as independent retailers seek to narrow the cost gap with other parts of the UK.