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The introduction of a new tax on large retailers in Scotland could lead to higher prices for consumers, according to David Lonsdale, Director of the Scottish Retail Consortium. The potential levy, being considered by SNP ministers as part of a Budget deal with the Scottish Greens, has raised concerns about the impact on businesses and shoppers.

The SNP’s minority government relies on the support of opposition MSPs to pass its annual budget, which is set to be unveiled on December 4. Discussions have begun with businesses and public health charities regarding the implementation of a supermarket tax, with the aim of raising funds for public health initiatives.

While the Fraser of Allander economic research institute estimates that a levy on retailers licensed to sell tobacco and alcohol could generate £57 million a year, critics like David Lonsdale argue that such a tax would be detrimental to businesses and could make Scottish retailers less competitive compared to those in other regions.

Lonsdale emphasized that any new tax on retailers would be an “unwarranted tax grab” that would ultimately result in higher prices for consumers. Despite promises of early engagement with businesses, there is still uncertainty surrounding the scope and intentions of the proposed tax, leaving retailers in the dark.

However, some Scottish Greens and SNP members see the supermarket tax as a way to target retailers selling alcohol and tobacco products, which have a significant impact on public health. Finance minister Ivan McKee acknowledged the party’s efforts in proposing new taxes and emphasized the need for constructive suggestions from all parties involved in budget discussions.

As the UK Government prepares to unveil its budget plans, Scottish Finance Secretary Shona Robison has called for increased investment in public services, infrastructure, and measures to tackle child poverty. The outcome of the budget negotiations and the potential introduction of a supermarket tax are likely to have far-reaching implications for businesses and consumers in Scotland.