John Webber, Head of Business Rates at Colliers International, welcomes the HCLG Committee’s recommendations, announced last week, that the Government considers taxing on-line deliveries and packaging whilst reducing business rates taxes for retailers in a bid to create a level playing field for the high street.
The committee had said that high streets needed “meaningful relief” from business rates and that “dated policies and an unfair tax regime” must change to enable town centres to survive. With on-line companies now accounting for about a fifth of sales and the number of bricks-and- mortar retailers declining in town centres at a rapid rate, an online sales tax, and possible an increase in VAT and “green taxes” on delivery and packaging- could help “level the playing field.”
However, as Webber points out, “This is something we have been calling for for years. The Select Committee warns about high streets becoming like ghost towns if nothing is done. I hope they realise that many are already ghost towns now and the golden goose of retail has already been fairly well cooked and indeed burnt around the edges.
“I also feel that comments about concessions to retailers with physical stores but not looking at wider business rates reform only addresses one half of the equation.
We need a total reform of the system and to look at the costs to other businesses including casual dining, pubs, office occupiers as well as the car industry and the manufacturing sector. We also need to look at the system of reliefs – we have business rates deserts in some parts of the country where some businesses pay absolutely nothing for the upkeep of local services. This is not equitable if the Government needs to take the same tax take from the system (£27 billion net).”
“And the appeal system continues to be a mess as I am sure this week’s CCA (Check Challenge Appeal) figures will show.”
“Only a total roots and branch reform will be enough to slow the tide. We support the recommendation to tax on-line retail to try and level the playing field – but the solution to the business rates problem needs to be much much deeper.”