MPs call for e-tail tax rise to support ailing high streets

Online retail heavyweights like Amazon should be subject to more taxes to help ‘level the playing field’ with physical competitors

Credit: Martin Rickett/PA Archive/PA Images

The government should hike taxes on online giants like Amazon to prevent high streets becoming “ghost towns”, MPs have said.

The Housing, Communities and Local Government committee urged ministers to “level the playing field” when it comes to business rates.

A fifth of UK retail sales now occur online, but high-street retailers pay much higher business rates than online shops because they need physical premises.

“Some formerly thriving shopping areas are likely to become ghost towns and effectively close down altogether unless the government, councils, retailers, landlords and the local community act together,” they added.

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The MPs urged the government to consider an online sales tax, a general sales tax, taxes on online deliveries, and higher VAT for web stores.

The cash raised would allow ministers to cut business rates for high street shops and plough investment into regenerating town centres.

Amazon refused to comment on the proposals but insisted it pays all taxes due in the UK and “every country where we operate”.

High streets minister Jake Berry said: “We know high streets are the backbone of our economy and a crucial part of our local communities, and we want to see them thrive – both now and in the future. We’re supporting small retailers too, slashing business rates by a third – building on more than £13bn of rates relief since 2016.”

The government unveiled a £675m plan to support high streets at the last budget that it said would improve infrastructure, reduce congestion and enable housing and new workspaces to be created.

Sam Trendall

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