British retailers call for tax rebalancing

In the UK, 35% to 40% of non-food purchases are now made online. During a preliminary consultation on the Treasury’s initiative published at the end of February 2022, UK’s major retailers called for a rebalancing of the tax system between “online” and “offline” and asked for a new e-commerce tax.

Indeed, physical retailers pay tax based on property values in premium shopping locations, whereas e-commerce companies using warehouses pay much lower rates because they’re located on cheap land in the suburbs.
While no official decision has been made, a new consultation is underway until May 25, so that all players can consider what form this tax might take (flat rate or based on turnover, etc.) and to whom it might apply. The Treasury’s report, published last autumn, had already announced a saving of €8.3 billion on the UK retail tax burden by halving tax rates for retailers, hotels and leisure for 2022 and 2023.

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