Rural areas like Caithness ‘will be worse off’ after Scottish Budget

A Caithness business leader has given a mixed reaction to last week’s Scottish Budget, which crofters and others say leaves people in rural areas worse off.

Trudy Morris, chief executive of Caithness Chamber of Commerce, acknowledged the Scottish Government’s “fiscal challenges” ahead of the 2025-26 Budget.

She said: “There was some good news with the announcement of 40 per cent rates relief for most hospitality businesses (although not for retail and leisure premises, which are covered by the equivalent relief in England and Wales), a key ask of the chamber network.

“However, whilst we appreciate the challenges faced by government, it doesn’t go far enough.

“It is welcome news that the Scottish Government has recognised the importance of providing stability and certainty to taxpayers and businesses across Scotland, making a commitment to not introduce any new bands or increase the rates of Scottish Income Tax. The different tax bands have long been seen as a barrier to attracting talent to Scotland.

“We also note a continued commitment to the Developing Young Workforce (DYW) programme and look forward to hearing the detail around this. As the hosts of DYW North Highland, the Chamber is dedicated to helping young people realise their full potential.”

Ms Morris also welcomed further money for the Rural Tourism Infrastructure Fund (RTIF), which is aimed at providing “critical economic support to tourist hotspots”.

She added: “We look forward to hearing more detail around the revitalised multimillion-pound Rural Tourism Infrastructure Fund which previously was targeted to improve infrastructure, enhance the visitor experience and encourage increased visitor spend in rural communities such as ours.

“There is, however, concern around the references in the Budget to a public consultation on a cruise levy and the introduction of Air Departure Tax. The Scottish Government tried unsuccessfully to devolve Air Passenger Duty some six years ago and there is already concern around a visitor levy for the Highlands.”

Meanwhile, the Scottish Crofters Federation claimed the Budget would leave crofters worse off, in real terms.

Jonathan Hedges, SCF chair, said crofters will have to jump through increasingly onerous hoops to receive basic payments which cover input costs and help crofting to deliver small-scale successes.

“At SCF we know that crofters punch above their weight in terms of food production, nature-friendly agricultural practices, supporting rural and island economies, and the sustainability of communities,” Mr Hedges said.

“This is very disappointing – within months of the publication of The Value of Crofting report, commissioned by the Crofting Commission, which demonstrated what crofting contributes to Scotland’s economy, it’s clear that the government still does not fully understand the unique contribution that crofting makes”.

Scottish Land & Estates, the rural business organisation, argued that the Budget does little to show support for rural communities.

Stephen Young, director of policy, said: “The Budget offered an opportunity for the Scottish Government to put down a marker on how it values rural Scotland in the wake of recent decisions at Westminster - but it does little to move the dial for the long-term.

“Instead, the Finance Secretary has inflicted a real terms 3.1 per cent cut to the rural budget, where every other department in the Scottish Government received an uplift. This highlights the Scottish Government’s priorities - despite all that rural Scotland is expected to deliver.”

• The Scottish Budget at a glance: how it affects the Highlands and Moray from dualling to the NHS

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