The Rise of the Virtual High Street

17th June 2016

A UK parliamentary committee has recommended a levy on internet-only retailers like Amazon and Asos in order to level the playing field against high street shops who have to pay business rates on their shops.

Being very much up with the times, the committee of MPs noted that there had "been a recent increase in online businesses which, occupying premises with low rateable value or being home-based, pay low business rates in proportion to their turnover".

Public finance experts said this meant the companies were generating value but that it was not easily taxed by the current system and many local authorities have expressed concern that they were losing out on revenue from such businesses.

Rate collecting agencies have suggested that the problem should be dealt with by a transaction tax, possibly operated by the retailers themselves as part of the selling process.

As an example, Amazon's circa-£10m a year in UK business rates compares to UK sales of £5.3bn last year.

 

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