Chamber and committees

I have met representatives of both of our national parks and have had some very useful discussions. Again, I would be grateful for the committee’s views on this, but one thing that I have taken away from those discussions is the need to consider whether there must be any further provision in the eventual legislation on engagement with the national parks. That said, I recognise that the scheme is for local authorities to administer as the tax authority.

The bill as introduced provides the ability for two or more local authorities to work together. You could imagine, for instance, authorities that share areas of a national park working together on developing a specific levy that would cover the park, but that would be a decision for individual local authorities working together collaboratively. Similarly, on the point about a regional approach, the provision in the bill to allow local authorities to work together would allow a number of councils to collaborate on a visitor levy and to make decisions, through consultation and engagement, on how that revenue can be utilised most meaningfully and impactfully within their particular region. Again, though, those decisions will ultimately be for individual local authorities to take.

Notwithstanding that, I reiterate that I will consider what further measures might be required to ensure that the voice of the national parks is appropriately recognised—including in the proposed legislation, if necessary. I think that there is sufficient flexibility there. I am keen to ensure that the framework provided by the legislation is as straightforward to administer as it possibly can be, while retaining flexibility to allow local authorities to respond, either individually or collectively, depending on the needs and assets of their particular areas.

That question gets to the heart of the issue of national consistency and local flexibility. I appreciate that a view might be formed in the Parliament that, regardless of location, certain categories of individual circumstance should be exempt. However, I am also conscious of the importance of local autonomy in deciding what is best for a particular area, and of the need to ensure as much administrative simplicity as possible for local authorities and businesses. The legislation allows for exemptions to be determined locally. The expert group has undertaken work on best practice and guidance, and it could consider that as part of its work.

As for getting the balance right in this respect, I want to ensure that, beyond what is in the bill, business, communities and local government have the opportunity, through working together and engaging through consultation, to determine the best suite of exemptions—if any—for their particular area.

I am grateful for the opportunity to answer questions on this issue.

We very much recognise the views that have been expressed by local government since the First Minister’s announcement on the council tax freeze. In fact, since then, the First Minister and the Deputy First Minister have met and had engagement with COSLA.

The Verity house agreement, which underpins our new deal with local government, is broad and wide ranging. The fiscal element is just one part of that agreement; council tax is just one part of the fiscal element; and the council tax freeze is just one part of our considerations around council tax. The committee will be aware of the work that has been undertaken through the joint working group on sources of local government funding and council tax reform.

We are committed to engaging constructively with local government colleagues in COSLA to ensure that we are able to successfully implement a council tax freeze. I think that there is a shared understanding that that would be of benefit to households who are struggling right across Scotland.

It is progressing constructively, as is engagement in the pre-budget space. The visitor levy legislation, which we were considering in the previous evidence session, is an excellent example of the partnership working that is being done with local government to develop a proposition in response to a long-term ask from local government. We also touched on the cruise ship levy, which we have committed to. Again, that is a proposition that has come from local government and to which we are responding positively.

I lead on and have direct responsibility for certain aspects of local government finance, and I am committed to working in partnership with local government colleagues to look at the opportunities that we have to further increase the fiscal empowerment of local government. That is reflected in the visitor levy and the cruise ship levy that we have committed to, as well as in the work that we have undertaken on reforming aspects of the council tax, such as the consultation on levying a premium on second homes.

We are making progress and I know that my ministerial colleagues in other portfolios covering a wide range of areas can speak to where they have seen significant progress as a result of that partnership working approach. We are certainly committed to recognising the huge opportunities afforded by working in partnership and with mutual respect with our local government colleagues.

We are seeking to achieve a council tax freeze through partnership and engagement with local government, and the proposal is based on a shared recognition of the point that I touched on earlier about its meaningful impact on households across Scotland. The approach that we are taking is one of on-going negotiation and engagement. As I have said, it is through that process of partnership working with local authorities that we will seek to achieve and—I am confident—deliver the council tax freeze.

As I said in response to Mr Briggs, in the spirit of partnership with local government we will follow a process of careful and considered engagement to determine what the quantum will be, and I do not want to pre-empt that. As for the resourcing of this particular quantum, such decisions will be taken as part of the budget process, and the Deputy First Minister will set out the budget to Parliament in a statement next month.

As I have said, we will arrive at a position through the engagement and consideration that we have committed to having with COSLA. For me to seek to pre-empt the outcome of those discussions at committee would not be consistent with the commitment that we have made and intend to fulfil. We will have those discussions and that engagement in a spirit of partnership with local government. Through that process, we will seek to arrive at a quantum that is commensurate with the commitment to fully fund the council tax freeze.

I very much recognise the views and appreciate the concerns that have been expressed by you, Ms Gosal, and by colleagues in local government. We are committed to ensuring that the council tax freeze is delivered in partnership with local government. Engagements are already starting to take place. As I mentioned previously, the First Minister and the Deputy First Minister have both met COSLA specifically to discuss the matter.

As I touched on in an earlier answer, the Verity house agreement on a new deal with local government is significant and wide ranging. For example, on fiscal matters, early engagement in discussions around the budget is taking place.

There is a shared recognition that the agreement presents a tremendous opportunity to advance our shared agenda and our shared priorities with regard to ensuring that we have sustainable public services, that we tackle net zero and that there is a fair and just transition to a net zero economy.

I recognise the views and concerns that have been expressed. I am confident that there is a shared ambition to deliver on the vision and the priorities set out in the Verity house agreement, and we are certainly committed to taking it forward in that spirit.

The question is interesting because we can see that broadening the definition could involve a tension. Another request is that the definition be narrowed. I am not saying that we have necessarily nailed it and got into the Goldilocks zone, where the definition is perfect, but we have got pretty close to it. I reiterate the commitment to engage further with industry and local government on the wording.

The point about business visitors is important. Given that Scotland has such a strong events sector, we must be cognisant of that.

The requirement is in the bill because the policy intent that has developed over a number of years is that the levy is to generate revenue specifically for the visitor economy, as opposed to being a general revenue-raising tool. If it was to move to be a general revenue-raising tool, we would have to recognise that there is significant variation in the size of the visitor economies in the different parts of Scotland, which means different economic impacts. A visitor levy being applied in such a context would create significantly different and varying revenue-generating opportunities. A general power of that sort would understandably invite questions around equity and fairness and about how it would play into the overall local government funding formula.

That is not what the proposed legislation is about, however; it is about creating a discretionary power for local authorities, which can raise revenue from the visitor economy to support investment in the visitor economy with, I hope, the ambition of increasing the offering and ensuring that we have a sustainable future for our tourism sector by enhancing the world-class offering that we already provide.

As I have stated, I do not want to pre-empt the outcome of the discussions and negotiations that we have committed to having with local government. It is through that process that we will arrive at a quantum that will fully fund the council tax freeze. For me to seek to pre-empt that would be to disrespect that process.