A planned rise in business rates will leave Stonehaven a “ghost town”, a group of hoteliers have warned.
Business rates - set by the Scottish Government - are set to rise from April 1, and some hotels in the town are facing more than a 100% increase in the annual amount they are expected to pay.
Sheila Howarth, owner of the Belvedere Hotel on Evan Street, told the Leader that this, coupled with the oil downturn affecting custom, could lead to the closure of many of the town’s hotels, which in turn will have a devastating effect on tourism.
She said: “All of the hotels in Stonehaven are in the same position. Our accommodation is dead. It has been slowly declining for the last two years, but before that, we were fully booked all the time. The oil downturn is taking its toll on our businesses.
“Just as we are feeling the financial effects of this, the rates are increased. The rise is a more than 100% increase in some cases, it is just ridiculous. It is not sustainable.
“At the very least, jobs are going to be lost as we will be forced to close the rooms. Stonehaven relies a lot on tourism, but if there is no accommodation we will become a ghost town and the smaller businesses will suffer in turn.”
Sheila added that the town’s hoteliers have joined forces to attempt to come up with a strategy for going forward, and a meeting will be held on Thursday morning (January 26) at 10.30am in the Belvedere Hotel which is open to anyone affected, or who is worried about the rates.
Michelle Ward, owner of The Royal Hotel, said: “All the hotels in the North East are struggling at the moment. We have had hardly any guests since the summer season finished in October.
“To just open the accommodation side of the business my costs will be in excess of £150k per annum. Quite frankly we can’t cover that and we would be far better off financially if we were to close the accommodation side of the business and just operate as a bar and restaurant.
“If the re-evaluations go through we would be faced with two choices; close the hotel side of the business and pay off the hotel staff - some with over 25 years service - or continue trading in the current format until we go bust.”
Councillor Alison Evison has offered her support to the local business owners, commenting: “The new business rates are damaging to our local Aberdeenshire economy. They do not take into account changes to the oil and gas industry, the effects of which have been felt by a whole range of businesses in the local area. “
“At this time in particular, our region needs support from the Scottish Government, not an additional burden,” said Alison Evison.
“I am really concerned that some businesses will have to make people redundant or even close completely, if these rates are not adjusted. They will reduce the opportunities for our young people to train to enter the job market locally.”
“I have spoken to the Aberdeen and Grampian Chamber of Commerce, who have gathered the response to the business rates rises from the business community to present to the Scottish Government. I am adding to that voice.
“There is an urgent need for a review of the new system to take into account the changed circumstances in the North East. “
Mairi Evans, MSP for Angus North and Mearns, commented: “I’m very disappointed to hear that the rates of some of our fantastic local businesses and hotels in Stonehaven are being increased and I would ask any hotelier or small business owner who is the subject of a rates increase to contact me. I will be happy to meet or speak with them and will do all I can to help.
“The rating valuation of all business properties is carried out by independent assessors. These assessors are funded by local councils, who also retain the all business revenue rates they collect. There is an independent appeal process for individual business rate payers and I will advise any affected business owner on how the appeal system works.
“The Scottish Government wants small businesses to thrive and a ‘package of action’ has been announced to reduce business rates as part of the draft budget. The Small Business Bonus Scheme will be expanded – which has already saved businesses more than £1 billion – in April to lift 100,000 businesses out of paying rates.
“A further 8,000 business properties will be exempt from the Large Business Supplement and the business rates poundage – the core tax applied to the rateable value of business properties – is going to be cut by 3.7% to 46.6p.
“There will be a wider review of business rates and their role in supporting economic growth in the summer and I will be doing everything I can to ensure businesses in Stonehaven and the wider constituency are given a fair deal.”