MPs call for online sales tax to save High Street

MINISterS must consider an online sales tax to ease the burden on the High Street, MPs have urged.

the Government should also push ahead with a sweeping review of neglected town and city centres post pandemic, according to a report from Parliament’s levelling up, housing and communities (LUHC) select committee.

While the committee praised Boris Johnson’s government for measures such as the furlough scheme and Vat cuts during the pandemic, it criticised a ‘lack of co-ordination’ across departments and the failure to implement plans which would ensure the ‘long-term health’ of the High Street.

Since retailers are facing ‘pressing challenges’, it added, the review should be completed as a matter of urgency.

Bricks-and-mortar shops were already struggling before the pandemic with shoppers moving online and firms being burdened by business rates.

the pandemic exacerbated the problem, causing more shoppers to stay indoors and switch to the internet, while home-working has driven commuters away from city centres. even in November, when most Covid restrictions had been lifted, 47.5pc of non-food purchases were made online – compared to 30.8pc in February 2020, before the pandemic.

Business rates are only charged on firms’ physical premises, meaning companies operating mainly online tend to have a much lower bill.

Several bricks-and-mortar retailers and campaigners have claimed this is unfair, and have called for an online sales tax to even the playing field.

the Government had made moves to boost Britain’s shopping hotspots with its Build Back Better High Streets Strategy, announced this summer.

But MPs on the committee complained that there were holes in the strategy.

Funding streams for regeneration were ‘disparate and competitive’, it added.