Seeing the massive amount of competition and the crisis that has hit the offline stores the supermarket giant Tesco asked the government of Great Britain to impose a tax rate of 2 percent on the online retailing websites so that the cut that was made in the business rates of the offline outlets could be paid. The basis for this argument was that the system which is prevailing currently in the state of the United kingdoms is really unfair and needs to be reformed or changed.
The evidence which was sent to the treasury in a written form selected a committee for the purpose of investigation, with the largest retailer of the state of United Kingdom which was paying around seven hundred million euros per year for the business rates, thus making it as one of the largest taxpayers for the tax based on the property. The same company has made a proposal with all the details to reform or change the system which is also to be blamed for the problems that are being faced by the people who are working at the offline brick and mortar stores.
As mentioned by the report provided by the supermarket there could be a rise in the amount of revenue by an amount of 1.5 billion euros to the government if they impose a tax rate of that 2 percent on the online firms, as per the value-added tax regulations which are there presently.
The firm says that there could be compensation made by this money which is collected in the form of tax by funding about 20 percent of all the business rates that are there for the online retailers. It is also mentioned in the report that any small business firms that are present could be spared out from this online sales tax.
The system which is here for calculating the business rates is really damaging the overall growth and the investment which is made in all the sectors and is nowhere near to providing an equal trading ground for both of the retailers online and offline, as mentioned by the Tesco’s spokesperson. It was further mentioned that the company is having a belief to take actions for the prolonging and non-updated tax system which was not reformed since the year 1988 and hence is on a verge to destroy the trading communities of the country.
The written evidence which was submitted by the firm to the government boost out the campaign which was first initiated by the chief executive officer or CEO of the company, Dave Lewis, who demanded and called for a tax namely, Amazon Tax a year before.
Saying more over the proposal which was submitted to the treasury the spokesperson mentioned that, the rates of the business are really coming up higher and are outdated and need to be changed more quickly than ever. The rate is so high that it looks it is almost unsustainable by the retailers and is a reason for the closure of many shops in the previous year.