BUSINESS owners in the hospitality industry will have planned business rates increases pinned at 12.5 per cent.

Initially, the Scottish Government said it would raise the threshold of tax, which would result in rates soaring from April 1 due to revaluation.

The Federation of Small Businesses (FSB) claimed more than 500,000 businesses across the UK faced a bigger bill, with some going up as much as 300 per cent.

Smaller businesses would have been badly hit, with many closures forecast on high streets.

However, a U-turn by Finance Secretary Derek Mackay resulted in further measures to ease the burden on some businesses.

The Scottish Government now claims that seven out of 10 business properties in the area will pay the same rates as before — with half paying none at all.

MSP Willie Coffey praised the ‘multi-million-pound business rates relief scheme’.

Upper Nithsdale’s MSP Oliver Mundell, however, said: “The SNP-Green alliance has raised taxes on a number of fronts, including for those on middle incomes, for businesses with rate hikes and for higher band council tax bill payers — Upper Nithsdale is paying a high price for a decade of SNP rule.”

In neighbouring East Ayrshire, Mr Coffey countered: “We’re introducing a number of measures to help local businesses including a cap on rates rises and all in, we expect 100,000 small businesses to be exempt altogether.

“This will continue to help many local businesses to start up and go on to survive their crucial first few years.”

Business rates are a general tax on non-domestic properties and are charged and collected by councils.

East Ayrshire Council leader Douglas Reid added: “The Fraser of Allander Institute has said that the challenges facing public finances mean that bold and radical solutions will be needed and we are examining how we can deliver our services in the future with much less money available.

“I have confidence in the people of East Ayrshire and we will continue working with all of our stakeholders in the community and in other agencies to identify ways to work smarter and more efficiently to make sure East Ayrshire meets the challenges that lie ahead.”

Cumnock’s representatives at Holyrood and Westminster both gave Mr Mackay’s concessions their approval.

MSP Jeane Freeman said: “Carrick, Cumnock and Doon Valley needs thriving businesses, providing jobs for the people who live here. I’m delighted that, in addition to the many small business that the Scottish Government ensures pay no rate, there is also now the support for more local business from this relief scheme, helping to ensure businesses in this important part of our country can thrive.”

Her party colleague, MP Corri Wilson, added: “This is a very welcome announcement, and a very substantial package of support, which will mean that the vast majority of businesses will not see any rise whatsoever in the rates that they pay.

“The support being provided to the hospitality sector is very welcome. This industry was facing a substantial hike in rates bills, however the cap of a 12.5 per cent increase provides excellent support to pubs, restaurants and cafes throughout the area.”