Online sales tax 'will be passed on to customers'

Chancellor Rishi Sunak’s proposed online sales tax will impact millions of UK shoppers, with costs being passed straight onto the customer, delivery company ParcelHero has said.

Leaked emails have revealed that Treasury officials summoned tech companies and retailers to a meeting ahead of the UK budget in March, to talk about how an online sales tax would operate.

On Monday the shares of Asos, Boohoo, and Ocado reportedly dropped after reports of a double tax on companies that have profited from the coronavirus pandemic.

Eighteen high street retail bosses, including the heads of Tesco, Morrisons, Asda, and Waterstones, have called for a tax on online retailers similar to that paid by physical store sellers.

ParcelHero has said that home shoppers should not be duped into footing the bill for the impact of Covid-19.
The British Retail Consortium (BRC) has also openly opposed the measure.

“The e-commerce giants aren’t going to pay through the nose – they will simply pass any new tax on to the consumer,” said ParcelHero’s head of consumer services, David Jinks MILT. “Many people, particularly the elderly and the frail, are unable to risk shopping in-store because of the pandemic. These people, many of whom have turned to online shopping for the first time, would bear the brunt of the new tax. The rise of these so-called ‘silver surfers’ has helped keep down the spread of Covid.”

He said that the company agrees with the BRC’s view that an online tax would hit High Street retailers who have online operations and result in higher costs for shoppers at a time of severe weakness in the British economy.

“It’s simply naive to think that most of today’s successful retailers are not already online,” added Jinks. “Those that aren’t are staring extinction squarely in the face and no new online tax can save them.”

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