18 major retailers in the UK have launched a collective attack, urging the government to impose an online sales tax

Recently, 18 large retailers in the UK, including Tesco , jointly wrote a letter to the government calling on it to impose a 1% online sales tax on e-commerce retail giants such as Amazon before the spring budget, putting them on a "level playing field" with their online competitors.

Business rates cuts to prepare for post-pandemic retail recovery

Tesco boss Ken Murphy has called for a permanent cut in business rates in a letter to Chancellor Rishi Sunak .

At the start of the pandemic, the government initiated a rates "holiday" where retailers and leisure and hospitality companies do not have to pay rates in the current financial year. However, property tax will restart in April of the new financial year, despite non-essential retailers closing during the lockdown.

Retailers say failure to reform the rates system in the next Budget will hamper the post-pandemic recovery of the retail sector and could put more people out of work.

The letter, also signed by Asda chief executive Roger Burnley and Morrisons chief executive David Potts, warns that nearly 15,000 retail jobs have been lost in the last year and more are to come.

Online retailers should pay the same tax rate as brick-and-mortar retailers

The Retailers and Landlords Union also said reforms should ensure online retailers pay similar rates to bricks-and-mortar businesses.

“Lowering sales taxes for retailers and rebalancing the tax system to ensure online retailers pay their fair share of taxes would provide an important boost to brick-and-mortar retailers,” the letter states .

Tesco has reiterated its strong call for a 1% sales tax to be imposed on the largest online retailer, cutting the corporate tax rate by a fifth.

A Tesco spokesman said: “We firmly believe there should be a level playing field for all retailers, online or physical, which is why we are proposing an online sales tax of 1% for businesses with an annual turnover of more than £1m, while reducing business rate at 20%.

Retailers say now is the opportunity to reform business rates and create a system that is fair and sustainable for everyone, and the UK government needs to make changes.

It is reported that once this proposal is adopted by the British government, it will directly harm the interests of online retailers.

Retailers

UK Online Sales Tax