MP’s are backing calls for changes to the current tax regime in a bid to halt the current decline in UK high streets and town centres and allow them to flourish in the future.
A report published by the Housing, Communities and Local Government select committee has called on the Government to begin reforms in key planning and taxation including considering the addition of an online sales tax and reforming business rates.
The reforms would help the high street to adapt to changing demand and compete with online retailers such as Amazon on a more level playing field.
In the committee’s report, it says high street retailers are paying more than their fair share of tax, while online retailers are not contributing enough.
They highlight Amazon’s business rates, which currently equates to approximately 0.7 per cent of their UK turnover, while high street retailers are paying considerably more, with business rates ranging between 1.5 per cent and 6.5 per cent of turnover.
There are currently future plans to introduce a digital services tax in April 2020, to address issues related to historic avoidance of corporation tax, but the committee is concerned that this will still fail to address the imbalance between online and high street retailers.
Clive Betts, chair of the committee, said: The growth of online shopping has profoundly changed retail in the UK, and the knock-on impact on high streets has been stark.
Business rates must be made fair. They are currently stacking the odds against businesses with a high street presence and this must end. Tax reforms are needed to level the playing field between online and high street retailers, and we urge the Government to investigate all the options in this area, including an online sales tax.
‘We must begin a period of renewal and regeneration, establishing high streets as focal points of our communities comprising green space and health, education and leisure services, as well as a core of retail.’
The full report can be accessed at High streets and town centres in 2030 report