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Tuesday 19 March 2019

Save our high streets > a tax on online retail

Should we be taxing online purchases?
Futures Forum: "There are no magic wands to save the high street in its current form, but allowing Amazon to continue making billions to enrich its founder and its shareholders at the expense of our public purse should not be an option."

Some would say it wouldn't work:
Futures Forum: The 'Amazon tax' won't tackle the real threat of tech giants
Futures Forum: The 'Amazon tax' won't save the High Street > 'The nature of the offer on the high street is going to change over time. There's going to be less retail, more leisure, bars, community facilities.'

Others say we need to get creative:
Futures Forum: Save our high streets > give up Amazon – and embrace shopping on the high street again
Futures Forum: Save our high streets > the future of retail as a merged experience between online and offline

Following on from the government's latest initiative:
Futures Forum: Save our high streets > parliamentary report published

... it looks, though, as if something's about to happen, according to Retail Week: 

Government pledges 2% tax on online retail

By Hugh Radojev

11 March 2019

The Northern powerhouse and high streets minister has promised to extend the Digital Services Tax to include a 2% charge on online retail.

In answers to questions on the Future High Streets Fund in the House of Commons last week, Jake Berry, the parliamentary under-secretary of state for housing, communities and local government, said that the government would bring forward its own 2% tax on online retail announced at the last Budget, if an international agreement on the issue couldn’t be reached.

Berry said: “The government have been clear that online taxation in retail needs to be done as part of an international agreement, but we have also been clear that, if we cannot get such an agreement, we will come forward with our own 2% tax on online retail to ensure that we can continue, as we did in the last Budget, to give relief to those retailing on our high streets.”

The announcement comes nearly a month after the publication of a report calling for an online tax to “level the playing field” for high street retailers by the Housing, Communities and Local Government Committee.

At the autumn Budget, chancellor Philip Hammond announced a Digital Services Tax – under which online marketplaces would pay a 2% platform fee on revenue earned in the UK, not from payments directly from consumers. However, the initial announcement did not directly target online retailers.

The proposed tax was dubbed the ‘Amazon Tax’, highlighting the effect the etail giant has had on the UK’s retail landscape.

Berry was responding to a question from Lib Dem MP Tim Farron, who described the 2% tax as “puny” and said his party would “support higher taxes on tax-dodgers”. He added that the 2% figure “on mega online firms that avoid paying their fair share” was “an insult to shops on the high street”.

Hammond is set to deliver the government’s spring Statement on Wednesday, following a mooted final vote on its proposed Brexit deal on Tuesday.

Head of UK business rates at Altus Group Robert Hayton said: “Traditional bricks and mortar retailing is obviously property intensive with the reliance on property leading to a larger tax to turnover ratio compared with online only” adding that “traditional retail accounts for £17.12 billion of the overall £66.55 billion rateable value for all sectors in England and Wales which forms the basis of how business rates bills are calculated.” 


Government pledges 2% tax on online retail | News | Retail Week
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