RUTH SUNDERLAND: Rishi Sunak clearly feels enough is enough… and he’s right
Rishi Sunak‘s plan to tax the obscene profits being made in the pandemic by Amazon and fellow online retailers cannot come into force a moment too soon.
Ministers have stood by as the heart has been torn out of our high streets and online operators have become more bloated.
An online sales levy, coupled with reform of discredited business rates, must be part of any blueprint to save Britain’s shopping centres. Not only would it help repair battered public finances, it would give bricks-and-mortar shops a fairer crack of the whip.
Rishi Sunak’s plan to tax the obscene profits being made in the pandemic by Amazon and fellow online retailers cannot come into force a moment too soon (file photo)
Although action is unlikely in next month’s Budget, it seems Rishi has finally decided enough is enough. And he is right. The sheer scale of Amazon’s sales – more than £91billion during the final three months of last year alone – is breathtaking.
Such success is to be celebrated – but it comes with social responsibility and a requirement to pay proportionate tax. Amazon paid just £14.5million in corporation tax in 2019. But its UK sales leapt 51 per cent to more than £19.4billion last year.
Our tax system has failed to keep pace with the rampant rise of internet shopping. As a consequence, Amazon and others are romping away while paying the bare minimum.
The desperation over business rates can be gauged by the letter sent by top retailers, landlords and unions, pleading with the Chancellor for a cut.
Former Tesco chief executive Dave Lewis proposes a 2 per cent online sales tax coupled with a 20 per cent cut in business rates – a sensible idea.
Although action is unlikely in next month’s Budget, it seems Rishi has finally decided enough is enough. And he is right. The sheer scale of Amazon’s sales – more than £91billion during the final three months of last year alone – is breathtaking (file photo)
Crude attacks on Amazon are misplaced. In the past year, it has been a lifeline for many households (file photo)
Alongside an online sales tax, Rishi is also understood to be considering a windfall tax on ‘excess’ profits made by online retailers during the pandemic – also a sound proposition.
Online retailers owe a large chunk of their outsized profits over the past year to the luck of being able to stay open – not to their merits.
Crude attacks on Amazon are misplaced. In the past year, it has been a lifeline for many households. In the past decade it has invested more than £23billion in the UK and created more than 30,000 jobs. Yet tax remains a stain on its corporate reputation.
A few rich firms, their shareholders and bosses should not be allowed unfettered freedom to cash in on the Covid crisis. It is neither equitable nor morally right that they should grow fat trading off a killer virus that has stymied traditional rivals.
The cost to consumers and society of letting Amazon and its peers become ever more rich and powerful is too high.
The Chancellor has the tax levers in his hands. He should not hesitate to use them.