Supermarkets battling to save free cash machines

SOME of Britain’s biggest supermarkets are appealing against a move that could spell the end of free ‘hole in the wall’ cash machines attached to shops.

Tesco, Sainsbury’s and the Co-op are among those taking the Government to the Court of Appeal after a costly legal ruling in April over business rates on the cash machines.

That ruling upheld a decision in 2013 that cash machines built into the front of a shop or petrol station should have a separate business rates bill – a move costing the industry nearly half a billion pounds. The decision led to fears that small shops and independent petrol forecourts may be forced to close ATMs or start charging for cash withdrawals.

Experts said that charging business rates on ATMs amounted to a ‘stealth tax’. It came as the sector has already been left facing crippling business rate rises under this month’s revaluation.

But retailers are fighting back in what is expected to be a lengthy legal battle. They are having to pay £39.3million a year on cash machines – or nearly £2,800 on average for each ATM – according to rents and rates specialists CVS.

While ATMs attached to retailers are having to pay rates, it does not apply to free-standing cash machines within stores. But it still affects many thousands of hole-in-the-wall ATMs, with the number liable for business rates surging from 3,140 in 2010 to 14,068 this year.

James Lowman, chief executive of the Association of Convenience Stores, said: ‘Cash machines, especially free-to-use ATMs, provide an important service to customers and support the wider community where often their local shop is the only source of free cash.

‘The ruling that “hole in the wall” cash machines should be rated separately is demonstrative of the mess that the business rates system is in, and we encourage Government to look again at this and other measures to make business rates fairer for local shops.’