Scottish retailers have been warned cash machines may not be the moneyspinner they seem as rates are going through the roof when the hole goes in the wall. The Scottish Grocers Federation is investigating "exorbitant" business rates charged to stores for space around cash machines, after members complained. SGF chief executive Lawrie Dewar said rate assessments of the part of the store with the ATM go up two and a half times. Rent negotiated by retailers with banks and suppliers for the space occupied by the machines does not cover the unforeseen expense, unless there is a catch-all clause. If retailers are by then tied into the typical three year contracts with ATM providers, the increase in rates cannot be offset against the machines. The federation is canvassing its members on the number of transactions per year and rateable valuation of their cash machines to establish the extent of the issue. Dewar said: "The situation is ludicrous. We are investigating the whole principle behind the rateable value of ATMs, and whether they should be rated at all. We are working with the banks to try to take rates for the ATM area out of the retailer's pocket." But Asda appears to have found a way round this problem following a case heard by the Lanarkshire Valuation Appeal Panel. It ruled that in Asda's case ­ where the ATMs were housed in a segregated area ­ the banks "had enough exclusive possession for business use to be considered in occupation". While this may set a precedent for supermarkets to put ATMs in a separate area so they can be rated to the provider, it will be of little help for small store retailers. The issue is not creating headaches for retailers in England and Wales because the Lands Tribunal has decided the cash machine area is part of the store. {{NEWS }}