Time to help High Street

USE it or lose it. We all know the rules. if you do your main shopping at the supermarket and just rely on the local shop if you run out of milk, you can’t complain if it closes. if you always fill up at the supermarket, the local petrol station won’t be there for the gallon for the lawnmower. if you don’t pay for the local newspaper, don’t be surprised if there is no one to report what is going on at the council meeting.

and so it is with the shift to online, the relentless theme of so many stories on these pages. yesterday business leaders bit back.

The common point here is that this is not a level playing field. Compare online with the High Street. it is not just that the online distribution system trims out a lot of cost. That is fair enough, because it also adds some costs too – less spent on property, more on handling and delivery. What isn’t fair are the higher taxes levied on the ‘old’ ways of doing business vis-à-vis the ‘new’ ones.

at least three things need to be done. First, there is the specific issue of business rates, which have been treated by governments as easy meat. People vote, businesses don’t.

Only when the businesses pull out do people realise what they have lost – and that rates have been the tipping point. Second, company taxation has to become fairer. it is intolerable that the giant high-tech companies should pay so little tax. They have, in the main, done nothing illegal. They have merely exploited tax loopholes that the politicians have created. but it defies common sense that foreign companies that make much of their profits in the UK should pretend that they are really running their businesses from Dublin or Luxembourg. One of the side effects of the UK leaving the Eu will be to increase pressure on these tax havens, and not before time.

Third, governments need to look at whether the details of legislation and regulation give artificial help to new business models. Does labour legislation favour their gig-economy labour force? Do parking restrictions encourage people to order in instead of going out? Does planning regulation help new disruptive businesses at the expense of old established ones?

ultimately we consumers will choose how we want to spend our hard-earned money. if a new-style enterprise can offer better value or a better service then it will get the business, as it should.

but we need a level playing field.

Winners and losers

WHO is winning the trade war?

We focus inevitably on what is going on between the US and Europe. but the bigger story is in China. Shares in Shanghai have formally fallen into a bear market, a decline of 20pc from the high in January.

This wasn’t just the result of the trade war. The new banking and insurance regulator Guo Shuqing is seeking to curb the financial excesses that have built up over several years and deliver a safer banking system.

One effect of this was a squeeze on share prices. but trade troubles have now come on top of more general weakness. Given the huge trade surplus China has with the US, it is hard to see how China can retaliate effectively by trying to cut US imports. Since it cannot match the US on tariffs, it may target US service exports or the activities of US companies in China.

but it is clear that it has much more to lose and the Chinese leadership misjudged the force of US antagonism. Falling share prices is a reflection of this disarray.

So what should we look at to gauge how the trade tussle is going? it is the numbers. The key numbers will be what happens to Shanghai and to Wall Street. both are wobbly, but the Chinese market is more so.

Going Dutch

FERROVIAL, the Spanish company that operates Heathrow, has chosen the day after the third runway bill went through Parliament to announce it is moving its headquarters to amsterdam.

Clever? no, seriously stupid. This is a long game. This sort of in-your-face gesture is just the sort of thing to convince british people that it was a mistake to sell Heathrow to a foreign construction company, to allow it to take billions of cash out of the business, and load it up with debt.

Whatever your views on the wisdom of the new runway, this will make it harder to get it built.