(Image: Newsquest)
Scotland's business rates system is placing growing pressure on businesses across the country, with soaring bills threatening jobs, investment and the future of our high streets and rural communities.
In Reset the Rates , The Herald investigates the impact of a tax system business owners say is unfair, unpredictable and increasingly unaffordable.
Through exclusive reporting, interviews and expert analysis, we examine the problems facing Scottish businesses and set out six major reforms designed to make the system fairer, simpler and more sustainable.
Follow our campaign below as we publish new stories throughout the week, highlighting the people affected and the changes needed to protect Scotland's economic future.
Day One
Fiona Campbell, ASSC chief executive. (Image: PR handout)
For many Scottish business owners, the arrival of a new rates bill has become a moment to dread.
Hotels, pubs, restaurants and tourist accommodation providers have reported sharp and unexpected increases in costs following the latest revaluation of non-domestic property in Scotland, leaving many scrambling to find thousands of pounds extra every month to meet their bills.
That’s why The Herald is today launching Reset The Rates, a major campaign for fundamental reform of Scotland's business rates system.
Backed by leading business figures and industry organisations, the campaign argues the current regime is too complex, too unpredictable and increasingly risks holding back sectors that are vital to local economies and communities.
The Herald is calling for major reform to the system. Here are the six changes we are looking for and why. (Image: Damian Shields/Derek McArthur)
Few taxes have a bigger impact on Scotland's economy than business rates.
Business rates are forecast to raise more than £3 billion for local services this year, yet concerns over the size of bills, the way they are calculated and the complexity of the system have fuelled calls for reform across the business community.
From frustrations in the hospitality trade over the method used to work out bills to anxiety among sole traders over the red tape that plagues the system, rating policy in Scotland is ripe for reform.
That’s why The Herald is calling for major reform to the system.
Our letter to First Minister John Swinney (Image: Newsquest)
Latest figures show Edinburgh contributed more non-domestic rates income than Glasgow in 2025-26, while East Lothian emerged as one of the fastest-growing contributors to business rates revenue in Scotland (Image: Getty)
Edinburgh has overtaken Glasgow as the largest contributor to business rates income in Scotland, but the latest breakdown of non-domestic rates (NDR) points to wider and, in some cases, striking changes in the country's commercial tax base.
The Scottish capital contributed £397.5 million to Scotland's NDR pool in 2025-26, narrowly ahead of Glasgow’s £396.8m. Yet some of the most notable movements in the figures took place elsewhere, including a dramatic rise in East Lothian ’s contribution. Scotland’s overall contributable amount reached £3.08 billion in 2025-26, up from £2.75bn in 2019-20.
The influential business leaders and industry groups supporting The Herald’s calls for business rates reform in Scotland (Image: Derek McArthur/Damian Shields)
A wide range of influential business leaders and industry groups are supporting The Herald’s calls for business rates reform in Scotland.
High-profile Scottish chefs, restaurateurs, hoteliers, pub operators and other business owners have joined the country’s biggest trade organisations in signing up to Reset The Rates – a campaign calling for six major changes to the business rates system in Scotland.
Kirkcaldy and the High Street (Image: GT)
Scottish firms face a “postcode lottery” when attempting to access more than 20 business rates relief schemes, according to new research which reveals major variations in how support is administered across the country.
New research by the Federation of Small Businesses (FSB) has found there are 22 different types of non-domestic rates relief available in Scotland, which often require multiple applications from small firms who qualify for a range of protections.
Many of the reliefs have been introduced in recent years to cushion firms from steep rises in business rates following the periodic revaluation of non-domestic property.
However, research by the FSB found that there is no uniform application process, inconsistency in the applications of reliefs, and gaps in the information provided to businesses by local authorities.
Day Two
Calum and Rachel Ross of the Loch Melfort Hotel (Image: Loch Melfort Hotel)
The co-owner of a luxury hotel in Argyll has questioned what the hospitality industry gets in return from business rates after seeing the property's tax bill ramp up again.
Calum Ross, who owns the four-star Loch Melfort Hotel near Oban with wife Rachel, saw the rateable value of the property increase by nearly 40%, from £88,500 to £122,000, following the most recent revaluation. That followed a comparable rise after the previous revaluation in 2023.
Mr Ross said the latest increase has added around £2,000 to the hotel's monthly rates bill, equivalent to about £20,000 a year as business rates are paid in 10 instalments.
Chef Nick Nairn at his Lake of Mentieth cook school. (Image: Newsquest)
High-profile Scottish chef Nick Nairn has slammed Scotland's business rates system as "pretty impenetrable", declaring that it unfairly penalises smaller hospitality businesses and leaves operators battling valuations they struggle to understand.
The chef, who runs Nick's at Port of Menteith with his wife Julia, questioned how rates bills are calculated and criticised what he sees as a lack of meaningful consultation with business owners.
"Where is the thinking behind it? Where is the consultation? Where is the sit-down to figure out who is able to most afford it and what is the most affordable rate?" he told The Herald.
"They just slap it out and go, that's your rates.
"Of course, they have to gather revenue, that is a given. But it should be those who are most able to afford it that pay the most. At the moment, it seems to penalise small businesses unfairly. So, we need a better system."
Gordon Drummond of Cairngorm Lodges near Aboyne on the effect of business rates on his business. (Image: Gordon Terris)
When he established Cairngorm Lodges in Royal Deeside in 2013, it was held out as emblematic of the future of Scottish tourism.
Located deep in a 100-year-old Scots pine woodland, it was a template for the kind of off-grid, eco-tourism venture that the Scottish Government was so keen to support.
Now, following a sharp rise in the rateable value of the business, which since 2021 has also included the Cairngorm Bothies about a mile away, Mr Drummond fears the “sword of Damocles” is hanging over its very existence.
Day Three
ROX MD Kyron Keogh at Glasgow's Argyll Arcade. (Image: Newsquest)
The boss of a leading Scottish jeweller has criticised the "unfair" business rates burden faced by retailers north of the Border, warning that investment is increasingly being directed to England, where he argues the system is more competitive.
Kyron Keogh, managing director of Glasgow-based ROX, said retailers contribute a disproportionate share of business rates relative to their economic output and employment footprint in Scotland.
The Scoop portfolio includes the Ox and Finch in Glasgow, above, as well as Margo, Sebb's and Ka Pao in the city (Image: Newsquest)
Jonathan MacDonald understands the need for radical change to the way business rates are calculated for hospitality as much as anyone in the industry.
Mr MacDonald has co-founded some of the most popular restaurants to have launched in Scotland in recent years, including Ox and Finch, Margo, Sebb’s and Ka Pao in Glasgow.
Yet despite a string of successful ventures, the restaurateur and entrepreneur says Scotland's business rates system makes it harder for even experienced operators to invest and grow.
In fact, he feels the regime is “stacked against us”.
GV of Argyle Street, Finnieston, Glasgow. (Image: Colin Mearns)
One of Scotland’s most famous entrepreneurs has criticised Scotland's business rates system as a “tax on entrepreneurship and investment” as he backed The Herald’s Reset The Rates campaign to reform it.
Sir Tom Hunter declared there is a “clear disincentive to invest” built into the current system. He cited the example of a hospitality operator who was “rewarded” with the rateable value of their restaurant soaring from £50,000 to £350,000 after investing more than £1 million to bring it “back to life”.
Grassmarket pubs fear the lights might go out (Image: Getty Images/iStockphoto)
Let me ask a simple question – would you like to see a 10% increase in the hospitality sector yielding over 22,000 new jobs and adding an estimated £640 million annually of GVA to the Scottish economy, or a sector stagnant and contracting?
Hospitality is pivotal not just to our tourism industry. It is also a critical catalyst for growth and jobs, often the key to unlocking vibrant towns and villages.
So you would think we’d incentivise the sector instead of punishing it. As Mike Tyson once said, everybody has a plan until they get punched in the face. He might have added that you don’t expect the punch to come from the government, but here we are with a rates system geared to punch.
Day Four
Professor Leigh Sparks (Image: PR handout)
Business (non-domestic) rates originated as a 16th century tax.
Whilst business rates have changed a little over the intervening centuries, the basic concept of a property tax still holds true.
But in the 21st century the nature of business operations, their relationship to place and the reliance (or not) on physical sites have altered fundamentally. Those ‘left behind’ at the margins of this global corporate world such as small businesses and town centres receive a raw deal from the rates and taxation approaches we take.
Professor Leigh Sparks writes that the 'previous links between taxation and place have been dismantled' (Image: Newsquest/ Colin Mearns)
Current approaches to business rates and practices in Scotland are “ripe for reconsideration”, a leading academic has declared.
Writing exclusively for The Herald, Leigh Sparks, professor of retail studies at the University of Stirling, argues that the current system has failed to adapt to the “shifting nature of business”.
The respected academic says fundamental changes in the economy, including the growth of online retailing, global business structures and out-of-town developments, have transformed the taxation landscape.