Rebuild high street with online sales tax, say MPs

The government should “build back better” from the pandemic by cutting business rates on the high street, a cross-party group of MPs has said.

It comes six weeks after Chancellor Rishi Sunak disappointed Conservative and Labour politicians by failing to scrap the system in the Autumn Budget.

The levelling up committee welcomed “the principle” of reducing business rates, often seen as hurting bricks-and-mortar shops, with an online sales tax.

It did not recommend the rate of a potential levy, but said it should be used to help retailers “in a meaningful way and on a permanent basis”.

READ MORE: High street visits up 138% since last year

Trade union Usdaw claimed a 1% tax could pay for a 20% cut in business rates. The British Retail Consortium believes a 2% tax could be used to ditch the system altogether.

“You only have to walk down any high street to see how the retail sector has been impacted by the pandemic,” Usdaw general secretary Paddy Lillis said.

“We urgently need to level the playing field between online and bricks-and-mortar retail.”

He added that a plan for helping the high street should “make sure that retail jobs are good jobs”, ending low pay and insecure contracts.

Labour wants to do away with business rates by raising the digital sales tax on internet giants from 2% to 12%.

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