Daily Mirror (Northern Ireland)
Tax hits profits for John Lewis Bonuses fall to 3% as Waitrose shuts stores
THE boss of John Lewis yesterday blasted
Britain’s “bizarre” tax system as it slashed its staff bonus to a 65-year low.
Chairman Sir Charlie Mayfield called for a shake-up amid competition from online rivals.
“We have a taxation system that bizarrely penalises businesses that employ a lot of people and have a lot of buildings,” he said.
“At some point there will be a form of reckoning.”
The group paid £174million in business rates, £120m in National Insurance and £43m in corporation tax in the last financial year.
Mayfield quoted a report predicting a third of shops could close within a decade. This came as it announced a 3% bonus for nearly 84,000 “partners” who ultimately own the business.
The percentage of annual salary was the lowest since 1953. It was 15% a decade ago.
The group said it helped cut its debts by 13% to £2.7billion and continued investing up to £500m a year. However, annual profits plunged 45% to £160m, with a 56% slump in its department stores offsetting an 18% rise at the group’s Waitrose supermarkets.
John Lewis managing director Paula Nickolds blamed the weak housing market hammering profitable homeware sales, and discounting to match rivals. Waitrose, the bigger part of the group, confirmed five store closures yesterday, putting up to 440 jobs at risk. They are: Torquay and Teignmouth, both in Devon, Blaby in Leicestershire, Ashbourne in Derbyshire, and Barry in South Glamorgan.
Nearly 10,000 staff have gone since 2015, including 1,600 last year. It’s sparked anger with proposals to shift hundreds of workers who maintain stores to an outside firm.
Mayfield also warned a no-deal Brexit would be “extremely damaging and unfortunate”, but claimed it could handle disruption.
Waitrose, whose 20-year supply deal with Ocado ends in 2020, said its online sales were booming.
Rival Marks & Spencer is buying half of Ocado’s retail arm for £750m so it can finally sell food online.