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Tesco chief calls for online sales tax to save the high street

Tesco chief calls for online sales tax to save the high street


Tesco’s chief has called on the government to cut business rates and with money raised from a new tax for online retailers, can help throw a lifeline for Britain’s failing high streets.

Dave Lewis, chief executive of Tesco warned that innovation is being stifled and prices are under pressure with stores closing in their thousands.

Lewis said the system is “outdated, not fit for purpose, and doesn’t reflect the way people shop today.”

He said there had been major high street fatalities and it is “impossible” not to notice the increasing strain over the retail sector.  He said the Treasury has created a “downward spiral” as the rates system has been relatively unchanged.

John Allan, the president of the Confederation of British Industry said the system need a “fundamental rethink.”

Tesco CEO David Lewis

Writing in the Daily Mail, Lewis said, “It doesn’t matter whether you are a large retailer such as Tesco, or run an independent corner shop, business rates have a huge impact on every bricks-and-mortar retailer. This is unsustainable.”

Lewis hit out at online retailers, saying that they operate from out of town warehouses that are worth a lot less than high street properties, that means their rates are far less than traditional companies.

He said, “Our business rates system has barely evolved since 1988, yet the way people shop has changed profoundly.

Online retail has grown dramatically, while sales in shops have fallen. Healthy competition between shops and online is good for customers and drives innovation.

“But the ability to compete is undermined when the playing field between shops and online is not level.”

He added, “If we don’t act now, we are in danger of missing our chance. The warning signs are stacking up, with another big retail name lost almost every month.

“As I see it, there are only two choices. We can prolong the status quo, losing jobs and business and impacting communities. Or we can put our tax system back in step with sales.

“That would level the playing field, reduce the unsustainable burden of rates and increase investment for the good of retail, and our great nation of shopkeepers.”



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