UK-based representing body for retailers New West End has urged the government to implement a business rate reform to solve the inequality between high street and online retailers.
According to the retail body, the reform would also offer £5bn in savings in their rates bills to high street retailers.
New West End has published two reports urging the government to introduce a revenue-based tax to replace business rates for online businesses, which currently pay just one-tenth of the business rates paid by high street businesses.
It submitted these proposals last month as written evidence to the House of Commons Housing, Communities and Local Government Select Committee inquiry into ‘high streets and town centres 203’.
As per the reports, the retail body noted that the money raised from the taxes would be used to reduce burden for other businesses.
New West End Chairman Sir Peter Rogers said: “Business rates are currently the biggest tax that high street retailers pay, accounting for nearly half, 45%, of retailers tax bill.
“The current structure of business rates, whereby they are linked to the value of occupied property, not economic performance, provides online retailers with an unfair advantage and a 90% rate discount in an already struggling brick and mortar retail environment.
“London’s West End is a major contributor to the UK economy with retailers generating over £9bn in sales a year and employing over 80,000 people. If we do not act now, we damage the ability of those businesses to survive and continue to drive our economy.”
The report also states that the increase in business rates is one of the major contributing factors for the recent rising number of retail and restaurant closures across the UK.