STUC on SNP sponsored debate on the economy and small business

Speaking in advance of the SNP sponsored debate on the Economy and Small Business, Grahame Smith, STUC Deputy General Secretary said:

"It is very disappointing that, once again, debate over the future of the Scottish economy is focusing on business rates. It looks as if the election campaign is in danger of turning into an auction of virtue on who can come in with the biggest tax cuts for business. It is disappointing to say the least that the proposed cuts are not linked to any job-related investment.

“Let us be clear, the case for cutting business rates is not based on sound empirical evidence. No systematic analysis has been undertaken to quantify the effects of the business tax cuts proposed by the Tories and the SNP.

“By way of contrast, the international evidence is clear - Scottish businesses are not over-taxed.

“There is no good reason why the taxation responsibilities (not ‘burdens’) of small businesses should dominate debate in the forthcoming election campaign”.

The STUC asks all Scotland’s politicians to consider the following points:

• It is essential that the Scottish Executive remains focused on improving productivity throughout the economy and measures like tax cuts have very limited, if any, impact in this respect. Rather investment in skills, business support, support for innovation and co-investment will have a greater and more durable impact.

• SNP and Tory policy assumes that businesses will use savings from cuts in business rates to invest. The evidence for this is scant to say the least.

• Successful small businesses are embedded in thriving communities. Public investment is required to maintain the drive against social exclusion, to enhance community cohesion and to support fragile local economies. Tax cutting policies threaten this investment. Those proposing tax cuts should be held to account for the services that will be cut to pay for them

• To the best of the STUC’s knowledge, an overly high tax burden has never been given as a reason for a single redundancy in Scotland.

ENDS

For further information contact Stephen Boyd 0141 337 8700