MPs urge ministers to consider an online sales tax in order to reduce the High Street’s burden.
A report from the select committee of Parliament’s levelling-up, housing, and communities (LUHC), suggests that the government should push for a thorough review of city centers and neglected towns following a pandemic.
The committee applauded Boris Johnson’s government’s actions such as the VAT cut and furlough program during the pandemic. However, the committee criticised the lack of coordination across departments and failure to implement plans that would protect the High Street’s ‘long-term well-being.
Closures: A select committee of Parliament, Housing and Communities criticised the failures to put in place plans for the High Street’s long-term sustainability.
The review is urgently needed because retailers face “pressing challenges”, it said.
Before the pandemic, brick-and-mortar stores were in trouble with customers moving online and businesses being burdened financially by high business rates.
This problem was exacerbated by the pandemic, which caused more customers to switch to the internet and stay inside. Meanwhile, home-working has driven many commuters out of city centers.
Even in November, when most Covid restrictions had been lifted, 47.5 per cent of non-food purchases were made online – compared to 30.8 per cent in February 2020, before the pandemic.
Businesses are charged only for the use of a company’s physical premises. Companies that operate mainly online will pay a lower rate.
Campaigners and brick-and mortar retailers have argued that this tax is unfair. They have demanded an online sales tax in order to equal the playing fields.
This summer’s announcement of the Build Back Better High Streets Strategy by the Government, showed that it was making moves to improve Britain’s shopping areas.
The strategy had flaws, however, complained the members of the committee.
It added that funding streams for regeneration are ‘disparate’ and ‘competitive’.