The Scottish Government has announced a review of the non-domestic rates system, alongside plans to remove rate relief for vape shops from April 2027.
In a statement to the Scottish Parliament, Deputy First Minister Jenny Gilruth confirmed that vape retailers will lose access to certain business rates discounts as part of wider reforms aimed at strengthening the system and aligning it with public health priorities.
The move comes amid growing scrutiny of the sector and follows concerns raised by businesses and trade bodies over inconsistencies in the 2026 non-domestic property revaluation.
To address these concerns, ministers will appoint an independent panel tasked with examining the outcome of the revaluation. The panel will assess whether anomalies exist within property valuations and is expected to report its findings within three months of being established.
Gilruth said the reforms form part of a broader strategy to support economic growth while ensuring fairness across the business landscape.
“The Scottish Government is absolutely determined to drive economic growth, and enable businesses to invest, grow, and create jobs. A key part of making that economic growth a reality will be getting the framework right on Non-Domestic Rates,” she said.
“Ministers have heard the concerns raised by businesses and trade bodies about apparent anomalies within the 2026 revaluation, and that is why we are taking urgent action.
“This includes taking action to ensure vape shops are contributing to the high street, recognising the growth of the sector in recent years and ensuring rates relief aligns with our public health commitments.
“We will also examine comprehensive improvements and reforms that can be made to the non-domestic rates system, seeking independent advice and working closely with business. This will ensure that the system works overall – and provides the clarity, the confidence, the incentive and the transparency businesses need.”
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Non-domestic rates, often referred to as business rates, are a tax on properties used for commercial purposes across Scotland. Bills are calculated based on a property’s rateable value – linked broadly to its rental worth – and a nationally set multiplier known as poundage, with local authorities responsible for applying any reliefs and collecting payments.
Vape shops will join a list of sectors already excluded from certain relief schemes, including payday lenders, betting shops, car parks, unlicensed short-term lets and most shootings.
Further details on the independent panel are expected to be announced shortly, with its findings to be presented to Parliament.
