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'Tesco tax' plan defeated at Holyrood

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Scottish government plans for a large retailer levy to help offset budget cuts have been rejected by MSPs.

Finance Secretary John Swinney said the move, dubbed the "Tesco Tax", would bring in an extra £30m, while his budget was being reduced by £1bn.

But Labour, the Lib Dems and Tories voted the plan down at parliament after branding it "anti-competitive".

The Greens backed the levy, claiming the parties opposing it had taken large donations from big supermarkets.

MSPs backed a Liberal Democrat motion to halt the levy plans from being taken further by 68 votes to 46.

Mr Swinney argued the levy would affect about 0.1% of businesses, while addressing the effect of Treasury spending reductions and protecting hard-pressed families.

But his last-ditch attempt to win enough support for the charge failed win the support of opposition MSPs, who previously rejected the measure at a meeting of .

Making his case, the finance secretary said: "Over 90% of the £30m comes from the largest supermarket stores and out-of-town retail parks, with £23m from the largest supermarket chains."

Branding the move a "tax on jobs" Lib Dem Jeremy Purvis, said: "The SNP is all over the place on this tax and I'm pleased that it will go no further in this Parliament."

'Substantial donations'

Labour finance spokesman Andy Kerr, added: "The proposal, in my view, shows a complete ignorance of a very important area of Scottish business - one in nine are employed by the retail sector."

Gavin Brown, of the Conservatives, said: "The Scottish government's proposals in this area are nothing more than an ill-judged raid on retail at a time when they least need it."

Meanwhile, Green MSP Patrick Harvie said it was no surprise that the parties opposing the levy had taken "substantial donations" from big retailers.

Citing , the Greens said that, since 2003, the Labour Party received £10,942,808 from Lord Sainsbury and £99,056.50 from Tesco, while the Liberal Democrats received £35,684.50 from Tesco, and the Conservatives had £30,000 from Selfridges.

Meanwhile, political horse trading between the minority SNP government and rival parties ahead of next week's final vote on the has been continuing.

Mr Swinney insists the £33bn spending plans for the year ahead will promote economic growth - but the opposition MSPs are looking for changes before agreeing to support it.

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