The Local Government and Communities Committee of the Scottish Parliament today voted to support a Lib Dem annulment motion against the large retailer levy proposed by Finance Secretary John Swinney in his draft budget. The proposal has caused unanticipated controversy amongst MSPs as Liberal, Tory and Labour sided with big business to oppose the SNP plans.

SNP MSP Bob Doris questioned the Finance Secretary about the impact of the proposals on small businesses. Mr Doris drew the committee’s attention to figures from the Federation of Small Businesses which reveal that the number of fruit and veg retail premises in Scotland has decreased from 1160 stores in 1998 to 400 stores in 2008, and over the same period there are 555 less butchers and 235 less bakeries.

Mr Doris said: “If this trend continues as aggressively over the next ten years, the decline of outlying communities and town centres will accelerate. This levy is virtually insignificant when compared against large retail turnover and profit, and whilst I understand the objections of the corporate world I can’t honestly see what effect there will be other than a marginal decrease in profit. The levy would go some way to rebalancing the interests of the large retailers with small and medium sized businesses.

“The SNP, uniquely amongst the main Scottish parties, believes that those who have the broadest shoulders should carry the greatest burden. The budget before parliament is the best deal for the Scottish people given the severe economic conditions we face, including the continuation of the council tax freeze, maintaining 1000 additional police and frontline NHS spend increasing by £280 million. The other parties will have to explain which of these priorities they would cut. The retail levy would raise in the order of £30million so that’s a lot of money to lose given how precious every penny is going to be in the next financial year.

Mr Doris also sought assurances from the Cabinet Secretary that in future years the principal of a large retailer levy would be widely consulted on to improve the scheme. The Finance Secretary confirmed that the regime for collection of non-domestic rates is set annually and could be reviewed. Mr Doris added: “It is possible that in future years we could look at ways of ring-fencing some of the funds raised from the retail levy to undo some of the damage supermarkets have caused to our town centres and suburban communities. Many of these areas need investment and this could be one way of finding the money.

“We know there will be a £3.3bn real terms cut to the Scottish block grant over the next 4 years and recent contraction in the UK economy indicates that figure could get even larger. How can the Labour Party come to the Parliament after a prolonged period of spiralling debt under a UK Labour Government and demand that giant retailers be spared any of the pain? It is beyond all belief.  They would rather plug their own financial black hole by squeezing more from pensioners through increased council tax than take a marginal slice of supermarket profits to fund public services.

“0.1 per cent of business properties across Scotland will pay the new levy. In Glasgow, 17 of the city’s 25,000 businesses will pay. The united and highly charged opposition from the Liberal, Tory and Labour parties clearly has more to do with a looming election than running a country.

“It is regrettable that the committee should have been so blatant in its opposition but my hope is that these same MSPs will put the tactics to one side when John Swinney brings the proposal back to Parliament as part of the budget process.”