Owners of Denholm’s Auld Cross Keys Inn say their business could close if an appeal against rates changes is unsuccessful.
The inn’s owners of 13 years, Dave Bennett and Karen Massey, say they are now appealing against an increase in monthly bills from £600 to £2,100.
If their appeal is unsuccessful, it could put their 17 members of staff out of a job.
Legislation by the Scottish Government came into force in April and saw hotels experience the largest increase in rates.
In February, Scotland’s finance secretary announced a cap of 12.5% on changes to business rates for those in the hospitality sector.
However, Dave Bennett told the Hawick News: “If we have to pay that next year, it’ll send us into a massive deficit.
“No one can give us the actual formula of how this has been worked out, a lot of it is to do with turnover.
“It’s gone up from £600 per month to £2,100 but the Scottish Government have capped it, so it can only be increased by 12.5% for the next 12 months.
“What we are doing is paying what we paid last year plus the 12.5% and we have launched an appeal against it using some assessors from Edinburgh.”
Stuart Marshall, councillor for Hawick and Denholm, said: “The issue of such a hike in business rates for this business owner is a very worrying one indeed and to have such financial pressure placed upon this very popular establishment seems completely unfair.
“To ask for such vast sums of money from businesses like this one is in my mind completely unsustainable.
“It was quite disappointing to learn this week that the recently published Barclay Report stops way short of addressing the concerns of small businesses, hotels and bed and breakfasts.”
The Barclay Report into non-domestic rates was published on Tuesday after being commissioned by the Scottish Government back in March last year.
Led by former RBS chairman, Ken Barclay, its key recommendations include reductions in bills to help retain town-centre shops; cutting in half the supplementary charge for large business premises; and an increase in the frequency of revaluations, to every three years from 2022.
Business rates are a tax on non-domestic properties used to pay for local council services.
Mr Bennett also said his health has suffered due to the stress of the situation and added: “We weren’t born with silver spoons in our mouths, all of this is mortgaged and if it wasn’t for having to pay that mortgage we’d shut the door.”
John Lamont, MP for Berwickshire, Roxburgh and Selkirk, told the Hawick News: “I very much hope that the appeal by the pub is successful.”
He added: “Sadly there are many businesses across the Borders that are being stung by these hikes in business rates.
“These are important Borders businesses employing local people and we cannot afford for them to be lost.”
A spokesperson for the Scottish Government said: “We have committed to around £660 million of business rates relief this year, including capped increases within the hospitality sector, as well as ensuring over 100,000 small business properties – half of all properties – pay no rates at all.”
A Scottish Borders Council spokesperson said: “While a significant number of property owners have been affected, over 60% have seen no increase in real terms, and some have actually seen the rateable value reduce.
“A range of reliefs are available, including some specifically introduced this year, which includes a cap on increases for many businesses in the hospitality sector.