Labour’s Anneliese Dodds hints at support for online sales tax on tech giants
Shadow chancellor Anneliese Dodds has called for the government to level the taxation playing field between digital and bricks and mortar retail in a potential call for new online taxes.
Dodds said at a pre-Budget address on Bloomberg that there was a “big gulf on how businesses based in bricks and businesses based on clicks are taxed” and that it needed to be resolved.
The Sunday Telegraph reported yesterday that chancellor Rishi Sunak would announce a review into new taxes on online deliveries in a bid to target firms like Amazon and Asos who have seen profits soar in the pandemic.
High Street retailers meanwhile have been hard hit by a year of lockdowns and Covid restrictions, with The Centre for Retail Research saying the sector lost 180,000 jobs last year alone.
The chief executives of major supermarket chains Tesco and Asda last month called for a new online sales tax on digital retailers and to slash business rates to help High Streets.
Currently, the tax burden is heavier on bricks and mortar firms than online retailers as business rates are based on the value of properties used for business purposes.
Dodds said Sunak should not raise taxes in his Budget on Wednesday, but that Labour could be in favour of changes once the UK’s economic recovery is further along.
“We need to be guided by the economic situation,” she said.
“We have tremendous anomalies in the UK tax system, we particularly have a big gulf on how businesses based in bricks and businesses based on clicks are taxed – we need to focus on that in the future.
“We would look with interest to any longer term ideas the Conservatives might have to deal with that issue, especially if we see action into business rates which are a tremendous sunk cost for businesses based in bricks and mortar.”
It comes after Dodds launched a push last week for the government to do more to protect the UK’s struggling High Streets.
Dodds said in a major speech that Sunak’s Budget should focus on a post-Covid High Streets recovery by ditching planning reforms that would make it easier for developers to turn shops into residential housing.
She also called for an “empty shops order” that would allow councils to take over empty shops, fix them up and rent them out without the approval of landlords.
“Done well, everyone should win – the local community gets a diverse range of new services on the high street, a new enterprise has got the foothold it needs to start work, and the landlord sees rent coming back in again,” she said.
“We need to do more to rebuild our high streets so they once again become the thriving heart of our community.”