Rural businesses staring over a 'cliff edge' because of surging costs, Tories warn

By TOM GORDON, SCOTTISH DAILY MAIL DEPUTY POLITICAL EDITOR Published: 19:02, 7 August 2026 | Updated: 19:02, 7 August 2026 Scottish rural businesses are staring over a ‘cliff edge’ because of surging costs, the Tories have warned, after almost 5,000 closed since the pandemic. SNP Government figures show 4,700 ‘business deaths’ in farming, fishing and forestry since the start of 2020 – an average of over 200 each quarter. The Tories blamed high energy costs, business rates and National Insurance hikes, as well as Labour’s proposed family farm tax. North East Conservative MSP James Adams said: ‘These figures are extremely concerning and highlight the cliff edge that many businesses are staring down. ‘Protecting agriculture, fishing and forestry businesses must be treated as part of our national security. ‘These industries are the lifeblood of Scotland, but significant challenges such as energy costs, business rates, VAT, and a hike in National Insurance contributions are threatening their very existence.’ In 2024 then Chancellor Rachel Reeves announced a 20 per cent tax on inherited agricultural assets over £1million, ending a 100 per cent relief in place since the 1980s. After a furious backlash, and warnings of farmer suicides resulting from the change, she watered down the plan and raised the threshold to £2.5million. Surging costs have put many rural businesses in Scotland in danger, with 4,700 of farming, fishing and forestry businesses in Scotland closing Mr Adams went on: ‘Detrimental policy changes such as the family farm tax, surrendering our fishing waters to the EU until 2038 and climate change restrictions have all contributed to the downfall of key businesses across these sectors. ‘Both the SNP in Holyrood and Labour in Westminster must urgently signal a shift towards being more pro-business, rather than continuing to put jobs at risk and overseeing companies closing their doors.’ The ‘business death’ figures refer to businesses removed from the register of VAT-registered and Pay As You Earn firms because their turnover and employees are zero. In the three years before Covid, these averaged 175 per quarter in agriculture, forestry and fishing in Scotland, but this has jumped 17 per cent to 204 per quarter since Covid. The worst year for closures was 2022, late in the pandemic, when 930 firms shut. But provisional figures for the last 12 months show the rate has barely slowed, with 915 estimated to have gone to the wall. In April, family-run agricultural equipment supplier Turriff Agri Parts Ltd, in Aberdeenshire, said it would be closing after 47 years, with retiring MD George Mearns saying: ‘It is becoming harder to run a business now because all the costs involved have increased so much over the years.’ SNP MSP Calum Kerr said: ‘Our farmers and rural businesses have been hit time and time again by successive Westminster governments which treat rural Scotland as an afterthought. ‘The SNP provides Scotland’s farmers and crofters with the most generous package of direct support in the UK and is committed to supporting our rural businesses and communities.’ Scottish Labour rural affairs spokesman Donald MacKinnon added: ‘Action is needed to tackle these worrying trends and help rural businesses thrive. ‘Scotland’s rural industries are hugely important to our economy and our communities and Scottish Labour will stand up for these businesses.’ The Scottish Government was asked for comment. SNP ministers this week announced £3million to support businesses affected by the Cairngorms wildfire near Aviemore amid concerns many will otherwise struggle to survive. Scottish Land & Estates yesterday said the money would be ‘crucial as recovery begins’ but called for more investment in helicopters to subdue future blazes.