Gill review should address ‘acute’ business rates challenges

April 21, 2026

The review is an ‘important opportunity’ to recommend significant reforms to improve the fairness and effectiveness of Scottish business rates.

Analysis from UKHospitality Scotland found that Scottish pubs and hotels are routinely valued significantly higher than their equivalents in England, driving higher business rates bills. Valuations could be as much as £16,000 higher for a typical pub.

This variance highlights yet another way in which Scottish hospitality is at a competitive disadvantage.

While its positive the valuation methodology is being examined by the Gill Review, the Scottish Government needs to go further to properly fix the faults in the business rates system.

Our recommendations

UKHospitality Scotland has submitted a number of recommendations to the review, including how to address the broader implications of relying on a property-tax based system.

Our recommendations include:

1
Consider wider policy levers
The Scottish Government should consider policy measures beyond valuation methodology alone. In particular, it should explore how poundage rates and relief structures can be used to address structural inequities faced by property-intensive sectors such as hospitality.
2
Establish a formal industry engagement forum
The Scottish Assessors Association should develop a formal mechanism for ongoing engagement with industry. This forum should inform the development and periodic review of practice notes for licensed properties and hotels.
3
Commission independent methodological analysis
An independent expert body should be commissioned to undertake detailed analysis of hospitality property valuation using different approaches, including:
- Turnover-based models
- Rental comparison methods
- Contractors’ basis
This would provide an evidence base to support future reforms.
4
Strengthen cross-jurisdictional collaboration
There should be structured dialogue between the Scottish Assessors Association and the Valuation Office Agency to share best practice and ensure mutual learning across systems.
5
Assess the impact of a shortened tone date on accuracy of assessments
This revaluation was the second where the tone date had been reduced to one year. This was largely at the request of business and with the objective of having more relevant, up-to-date valuations.

It is worth making an assessment of the impact that this has had on the accuracy of valuations as there is necessarily less time for assessors to complete their valuations.

Need for action

Leon Thompson, Executive Director of UKHospitality Scotland, said: “The broken business rates system continues to plague Scottish hospitality businesses, often leaving them with higher bills and at a competitive disadvantage to their peers across the UK.

“The Gill Review is an important opportunity to bring forward significant reforms that address these acute challenges, which are stifling growth on the high street, investment and job creation.

“There has been recognition elsewhere that hospitality should be treated fairly by the business rates system, after decades of overpayment. The Scottish Government also needs to take that approach by looking at lower poundage rates for hospitality, as well as reforming the valuation methodology.

“It’s not fair or logical that a typical pub in Scotland could be valued significantly higher than an equivalent pub in England, leaving them with higher bills. The Gill Review can and should put forward significant reforms to fix the broken business rates system.”