Scottish Government to exclude vape shops from business rate relief

The Scottish Government has announced plans to remove business rate relief from vape shops next year.

Deputy first minister Jenny Gilruth revealed a proposal to make vape businesses exempt from relief as of April 1, 2027.

She also announced that an independent review will take place to examine the revaluation of non-domestic property, following reports of inconsistent valuations.

The panel will be tasked with identifying any “anomalies”.

Business rates, which are also known as non-domestic rates, are set by the Scottish Government but are collected by councils to help fund services.

The rate is calculated based on the rental value and multiplied by a nationally set tax rate,

The Scottish Government cut rates in the 2026/27 budget. Reliefs, such as the Fresh Start and Small Business Bonus Scheme, allow some businesses to receive up to 100% tax relief.

Currently, payday lending businesses, car parks and betting shops are unable to apply for relief.

Gilruth 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.”