STA Statement: The Scottish Tourism Alliance responds to the UK Government Autumn Budget 2024 Statement

Responding to the Chancellor’s UK Autumn Budget Statement (Wednesday 30 October), the Chief Executive of The Scottish Tourism Alliance, Marc Crothall MBE, commented: 

“The business community understand the fiscal constraints on both the UK and Scottish Governments, but the Budget measures announced does little to dig us out of the financial hole we’ve fallen into in recent years. In fact, for many businesses it could bury them.  

“We’re relieved that the small businesses that make up our sector will be protected from the rise in National Insurance contributions due to the employment allowance, but for the remaining tourism and hospitality businesses there will be serious implications. 

“Once again, this additional labour cost will strike the bottom line of the many businesses in our sector that are struggling to make a profit to grow and invest in their people and quality of their product offer.  

“Unfortunately, this announcement will now likely lead to business owners having to freeze any further pay rewards and pause new recruitment. Redundancies cannot be ruled out because some operators quite simply will not be able to afford the additional rise in employee costs. This will result in them having to reduce their trading hours or customer offer, impacting on availability and overall appeal. 

“Scotland staying price competitive as a destination for tourism and hospitality is already challenging for business owners. This is not helped that the UK’s VAT rate is one of the highest in the world at 20%. Complementing VisitScotland’s work, we welcome that the £750,000 allocated in the Budget to develop ‘Brand Scotland’ gives additional support for promoting and championing our tourism offer to the world.   

“Given the increase in wage bills for many businesses in our sector, it’s more important than ever that the Scottish Government mirror the passing on of 40% business rates relief across the border. Given there hasn’t been like-for-like relief over the past two years, it would be unforgiveable if this wasn’t replicated, especially when the Scottish Government is receiving a record £47.7 billion for 2025/26.  

“Following the Chancellor’s commitment to permanently lower tax rates for retail, hospitality and leisure properties, we urge the Scottish Government to continue to work closely with industry as part of its review of the business rates system and look to adopting a similar commitment.  

“We’ve reached a point where many of our businesses feel uncomfortable charging customers more to offset rising cost of doing business, including outlays on food, energy, insurance, and wages.  

“With the price points as they currently are our domestic and international customer already expect higher levels of quality, service, and value for money. Continuing to raise the prices charged to the customer to deliver this and offset the rise in direct business costs is no longer an option. 

“Business owners will no doubt be assessing and evaluating the implications of the Budget and be looking to the Scottish Government to help lessen the blow.” 

A copy of STA’s Pre-Budget Submission for the UK Government’s Autumn Budget 2024 can be viewed here.