The readers’ reaction to my editorial letter in the June 2011 reviewing the merits of internet tax, originally outlined by Tristan Cook in his letter to Vince Cable, was a great surprise. Clearly, many of you feel very strongly about this issue and believe that it should be promptly brought to the industry’s and the government’s attention.
John Hutchinson reminded me that he was championing the need to introduce an internet tax in 2007, when he was retra president. In fact, at the retra annual conference he put forward a suggestion to introduce an internet tax of 10% on companies with an internet turnover of more than £50,000 and operating from abroad. This, he argued, would create a fairer competitive situation and would not affect non-corporate business, such as eBay sales.
In 2011, the high street needs help more urgently than four years ago. In his recent email Tristan Cook pointed out that Comet is about to close 40 stores, Moben has gone into administration, Habitat is planning to sell 30 of its 33 stores, Currys has made a £224m loss, Thortons is closing 120 shops and Jane Norman just went into administration, as well as T J Hughes with the loss of 4,000 jobs.
Despite its great potential to generate substantial revenue for the Treasury, an internet tax is not going to be a popular issue with the government as it could be seen as a vote loser. And yet the independent sector has much to gain from it and we should address it as soon as we can. And address it we will. John and I agreed that the next step should be a round table discussion which would help us to identify the potential benefits and disadvantages of an internet tax, and all the related issues before any proposal could be made. It, of course, will be reported in IER. Therefore if you wish to contribute to this debate please contact me. And please watch this space.