A trade association with a long history criticising Amazon has weighed into the debate as to whether the UK should introduce a specific tax on online sales – dubbed as the ‘Amazon Tax’ – as suggested by the UK finance minister, the Chancellor of the Exchequer, Philip Hammond last week. We wrote about the proposal here last Friday.
The managing director of the Booksellers’ Association has urged the government to ‘act quickly’ and introduce the ‘Amazon Tax’ to “rebalance the playing field” between physical stores and online retailers. She has said:
This can’t wait till post-Brexit – the tax burden on the UK’s high streets – and the advantages exploited by online retailers in the same arena – are having a parlous effect on the retail industry. It’s vexing that it takes high profile casualties like the House of Fraser to force the government to act, but we hope they will follow through. A ruinous business rates system affecting retailers large and small and the egregious tactic of transfer pricing by some online giants are a toxic pincer movement on our high streets, and only governments can make the difference required to allow for an equitable and fair system to be imposed.
– Meryl Halls, MD, Booksellers’ Association
Amazon started off as a bookseller and, from its earliest days, gained a reputation as a disruptive influence to what was, and to a great extent remains, a fusty industry. Amazon’s requirement for big cover price discounts on books angered publishers almost from day one. However, needless to say, Amazon won out in the end and went onto become a challenger to the entire retail sector, not just books. And when was the last time you paid cover price for a book?
But, even though this does seem like a bit of axe grinding, the more troubling aspect (again) is a complete lack of any real detail of what this tax will look like. It does feel like the desire is for Amazon to be hammered to pay more tax itself. But the failure to appreciate that many smaller retailers sell online and could be impacted by this tax is still worrying.