Here are the business stories making the headlines in Scotland and across the UK this morning.

‘Tourist tax’ won’t be reversed in spring budget

Business leaders’ hopes of a U-turn on the “tourist tax” in next week’s budget are diminishing after the financial secretary to the Treasury warned of the complexities of such a move.

Nigel Huddleston, the minister responsible for the tax system, said in correspondence seen by The Times that it was “not possible to introduce the same system as before, given that it would now need to be open to visitors from the EU as well as the rest of the world. "Any new scheme, no matter the design, would take time to legislate for and implement in order to prevent non-compliance risks and ensure operation."

In a letter sent to one of the leaders of the tourist tax campaign, Huddleston added that “the chancellor has been clear that being responsible with the public finances is a key priority. A new VAT-free shopping scheme could subsidise a large amount of tourist spending that already occurs without a tax relief in place, without bringing any direct benefits to the British public.”

The tax-free shopping scheme, which allowed international shoppers to reclaim 20 per cent VAT on purchases, was axed by Rishi Sunak when he was chancellor in 2021.

Job vacancies tumble as interest rates bite

Job vacancies have tumbled nearly 15% as businesses struggle to hire in the face of high borrowing costs and while the UK battles a recession.

Vacancies in January fell below 900,000 for the first time since April 2021, according to data from the jobs search engine Adzuna, a drop of 15% from a year earlier.

The downturn will fuel hopes of an interest rate cut sooner rather than later, after the Bank of England raised borrowing costs 14 consecutive times before leaving interest rates unchanged at 5.25% since last August.

In high interest rate environments, businesses’ budgets are stretched as borrowing becomes more expensive. This means there is less cash to hire new employees. Economic uncertainty in times of recession also slows hiring.

Changes in the Bank Rate take approximately a year to filter through to employers’ decisions, but the weakening jobs market suggests that the effects have started to be felt.

Next weighs move for stricken cosmetics chain The Body Shop

Next has approached administrators to The Body Shop about a potential deal to purchase parts of the stricken cosmetics chain.

Sky News has learnt that executives from the UK fashion retailing giant have contacted FRP Advisory to express an interest in acquiring assets as part of any sale process it decides to launch.

There were doubts this weekend, however, that FRP, which was appointed to handle the insolvency of The Body Shop in the UK earlier this month, would elect to run a conventional auction, with one source suggesting that contact between FRP and Next had already stalled.

Next is understood to have been monitoring The Body Shop for some time, but people close to the FTSE-100 company confirmed that it had expressed an interest in assembling a deal.

Post Office hires ex-police to check its investigators in Horizon scandal

The Post Office has hired investigators, including some ex-police, to look at its own staff's previous work investigating the Horizon scandal.

The new team will look at allegations against current and past employees involved in the prosecution of sub-postmasters and sub-postmistresses.

Concerns about conduct have been raised during an ongoing public inquiry.

A spokesperson said it was aware of the human cost of the scandal.

Relevant findings from the internal investigation could be passed on to authorities, including the police, or acted upon by the Post Office itself.

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