Industry bodies renew support for online sales tax to 'level playing field'

Industry bodies have renewed calls for the introduction of an online sales tax to “level the playing field” as a government consultation comes to a close.

The government has consulted on proposals for a tax on online sales, with the proceeds offsetting a reduction in business rates for high street operators.

UKHospitality has stressed that were such a tax to be introduced it should involve exemptions for services that are ordered online but involve delivery of services in person for example hotel bookings made online and restaurant delivery.

UKHospitality chief executive, Kate Nicholls, said: “We are calling for an online sales tax to be introduced in the UK to cut business rates for high-street venues and deliver economic regeneration across the UK.

“The basis for an online sales tax must not stifle innovation and the development of online business models but must support our British high streets. This is why government must ensure that an online sales tax avoids double taxation for businesses that deliver product on-premise, such as pubs, restaurants and hotels.

“The taxation system has lagged way behind the changes to the modern economy and while we have long known that business rates are arcane and outdated, there is also an absence of an equitable system of justifiably bringing the digital economy into taxation.”

Chief executive of the British Beer and Pub Association Emma McClarkin added: “Our current taxation system is not working for breweries and pubs. We are overtaxed and paying higher business rates than most other sectors, whilst online retailers reap the benefits of low taxation and a booming trade.

“If the government wants to support pubs – the jobs they support and the role they play in their communities - they must do more to rebalance the taxation system, so pubs and breweries aren’t subsidising the digital economy’s fair share of tax.”