Rates change could cost 1,500 filling station jobs

MORE than 1,500 jobs are at risk at Scotland's filling stations because tax assessors are using rules applied in England and Wales.

The Retail Motor Industry Federation (RMI Petrol) – which represents two thirds of the 9,000 petrol forecourt sites in the UK – has warned that 300 filling stations could close if as expected business rates increase by up to 450 per cent.

About 500 jobs are already at risk because of rising costs and falling profits at rural filling stations, the organisation claimed, but a further 1,000 posts could come under the axe following changes to business rates.

Forecourt shops are being rated on turnover, not on square footage like other retailers, RMI Petrol said, labelling the practice "anti-competitive".

Scottish Assessors – who advise the Scottish Government on setting business rates – are using data from the Valuation Office Agency (VOA), which sets business rates in England and Wales, it said.

The trade body claimed the data was derived from a limited number of English filling stations, where the markets and business models differed from those in Scotland.

Brian Madderson, chairman of RMI Petrol, said: "Put simply, this is a quango cock-up, which will cost the Scottish economy 1,500 jobs. Scottish independent forecourt operators are being hood-winked into a huge increase in rates as a result of anti-competitive procedures adopted by the Scottish Assessors and the VOA. The costs, both social and financial, of this change, are enormous to rural societies, the motor retail industry and the economy as a whole.

"The Scottish independent forecourt operators have been left in the dark and are due an almighty shock when they eventually received guidance from the Scottish Assessors."

RMI Petrol's warning comes as a further blow to filling station operators in Scotland, who are already facing an uncertain future amid low profitability.

A report commissioned last year by Highlands and Islands Enterprise warned that half of the forecourts in the north of Scotland and on the islands were under threat of closure within the next ten years.

Rural sites provide a vital service in remote areas but are subject to higher fuel prices from suppliers.

A Scottish Government spokesman said information provided by the Scottish Assessors was being considered and that an announcement on the outcome of business rates revaluation would be made shortly.

He added: "While no decisions have been taken, we are absolutely determined to help Scottish companies emerge strongly from the economic downturn. That's why we have already introduced a deferral scheme that allows businesses to spread payment of this year's rates bill over three years.

"And we are keeping the business rates poundage in line with England for 2010-11 – the lowest national poundage ever set for Scotland.

"This will give our businesses a saving worth almost 220 million in 2010-11 and, when combined with other support, will provide Scottish businesses with a competitive advantage over other parts of the UK. Our other initiatives include rural rate relief, which offers rate reductions of up to 100 per cent for petrol filling stations in rural areas."

The 14 Scottish Assessors are appointed by Scotland's 32 local authorities, with four working directly for councils and the other ten for valuation joint boards.