Seven in ten Scottish businesses (69%) have experienced business rate increases over the past year, according to the latest quarterly Understanding Business survey of more than 500 Scottish firms, published today.
More than half (51%) of affected companies said they have raised their prices in response to rising business rates. Other actions taken include changing strategy (38%), delaying growth plans (27%), dipping into savings or investments (22%), creating new charges (18%), and cutting staff (14%).
The survey, which covers Scottish firms across sectors, found that two-in-three businesses (65%) expect to increase prices over the next three months – the highest level recorded since June 2023, at the peak of the post-pandemic cost-of-living crisis.
Business survival concerns have also risen sharply. Two-fifths (40%) of businesses said they are more concerned about survival than they were three months ago, the highest level since March 2024. Fuel costs are an additional pressure, with two-thirds (66%) saying they are more worried about fuel prices than three months ago.
Reducing business rates was the second most cited intervention that respondents said would help business growth, cited by 32% – the highest level recorded since June 2024 – ranking second only to reduced taxation overall (40%).
Malcolm Robertson, chair of the Understanding Business steering group, said: “These results paint a stark picture of the pressures facing Scottish businesses right now. Rate increases are compounding already significant cost challenges, and it is clear that firms need meaningful relief if they are to invest and grow.”
The survey also revealed a sharp drop in confidence in Scotland’s elected leaders. Only two-in-five (41%) firms believe the Scottish Government is taking action to address Scottish business concerns, a six-point drop from the previous wave at 47%. Just over a quarter (28%) of respondents said they believe the UK Government is addressing their concerns.
