Online retailers urged to pay higher taxes to save UK shops

Bloomberg

Internet retailers such as Amazon.com Inc., Asos Plc and Boohoo Group Plc should pay higher UK taxes to help save ailing shopping districts that are losing revenue to e-commerce, according to a government report.
An online sales tax, higher value-added tax and “green taxes” on shipping and packaging should all be considered to help soften the blow to physical stores as consumers shift to internet shopping, according to the report from the Housing, Communities and Local Government Committee.
Some 70,000 jobs were lost in the UK retail sector in 2018 as chains like Marks & Spencer Group Plc and Debenhams Plc announced plans to close hundreds of stores. Tesco Plc, the UK’s biggest retailer, announced as many as 9,000 job cuts in January. Internet sales are a major factor, with UK consumers spending more via the web than those in any other European country, and one-fifth of December retail sales made online, according to the report.
“Business rates must be made fair,” said Clive Betts, a member of the House of Commons and chairman of the committee, in the report. “They are currently stacking the odds against businesses with a high-street presence and this must end.”
Asos shares fell as much as 3.2 percent in London, while Boohoo’s declined as much as 2.7 percent. Brick-and-mortar retailers pay more than their fair share of tax, while online retailers are not contributing enough, the report said.
Amazon’s rates amount to around 0.7 percent of its UK revenue, while most street-based retailers pay double to eight times that. The tech giant already faces the introduction of a UK digital tax from April 2020.