The Scottish Government’s budget plans were in turmoil after MSPs moved to block proposals for a tax on large retailers.
However, SNP MSP Bob Doris said the opposition would have to explain how they would make up the £30m.
“It is disappointing, but not surprising, that these parties preferred to vote against an SNP Government that is working for Scotland than to do the right thing for public spending and public services,” he said.
“It is now incumbent on Labour, Lib Dem and Tory to tell us which £30 million of spending they want to remove from the Scottish budget or how they will fill the gap.”ReactionsLast night the Confederation of British Industry Scotland’s assistant director David Lonsdale welcomed the development.
“Making it more expensive to invest and create jobs here in Scotland than elsewhere in the UK is self-defeating,” he said.
Fiona Moriarty, director of the Scottish Retail Consortium, added, “Members of the committee have taken a level-headed look at the potential economic impact of this levy and wisely taken the view that it is not in the interests of the Scottish economy or Scottish jobs.”
Colin Borland of the Federation of Small Businesses said he was disappointed by the news, although he added, “We are sure they will now get round the table and address any difficulties ahead of the budget.”
The levy would affect 0.1% of Scottish businesses, increasing the proportion of their average annual turnover spent on business rates from 2% to 2.3%.
Last night Mr Swinney indicated he would press ahead with plans to keep the tax in the budget.
“The proposal and order will now be subject to consideration by the full parliament next week, which we welcome,” he said. “We will continue to press the case that those with the broadest shoulders should bear more of the burden in supporting spending for vital services, at a time when Westminster has slashed Scotland’s budgets by £1.3bn and UK GDP has gone into reverse.”
In a later debate MSPs voted to progress the budget to another reading, but said they would require changes before supporting it entirely.
Holyrood’s local government and communities committee voted to scrap the Large Retailer Levy, which has become known as the Tesco Tax due to the way it would impact on big supermarkets.
The decision, which will need to be agreed by the full parliament next week, means finance secretary John Swinney is facing a £30 million black hole in his spending plans.
His budget for 2011-12 includes a provision to raise that amount from the most expensive business properties, 86% of which are occupied by the big four supermarkets.
In Tayside alone the tax would cost supermarkets nearly £2.5m a year, with the largest supermarket in the area the Kingsway West Tesco Extra in Dundee paying an extra £376,500 a year.
In Fife the levy would cost supermarkets more than £1.5 million.Jeopardising plansGlenrothes MP Lindsay Roy has expressed fears the proposed levy could jeopardise plans to open a Sainsbury’s store in Glenrothes and a Tesco in Leven, but addressing the committee before the vote yesterday, Mr Swinney the MSP for North Tayside insisted this was not the case.
“Of course we would want to ensure we are able to attract all business opportunities that we are able to attract to Scotland,” he said. “It is what I spend a large amount of my time doing.
“The extent of the scale of money we are talking about here suggests to me they are not scales that would influence supermarkets opening.
“I think the committee can be confident that they can support the move without the economic consequences that are being suggested.”
The committee remained unconvinced, however, and voted for Lib Dem finance spokesman Jeremy Purvis’s motion to axe the plan by five votes to three. Only the SNP MSPs on the committee voted against.
Mr Purvis said, “The SNP say that if you trade in Scotland and are successful, if you grow your business and employ people, then you’re liable to be hit with an arbitrary tax with no consultation.”
Tory enterprise spokesman Gavin Brown added, “Today we have protected Scottish jobs and this ought to be the final curtain for the Salmond super-tax.”