MP wants online shopping tax to help high street

A Norfolk MP has called on the government to introduce online VAT taxes to battle “the economic and social loss” online shopping is having on the high street.

Duncan Baker, Conservative MP for North Norfolk, urged the government to consider bringing in a “VAT style online sales tax” after quizzing treasury minister Jesse Norman on measures to support the retail sector through the Covid-19 aftermath.

But Mr Norman warned of the need to protect “a nation of virtual shopkeepers”.

Mr Baker asked: “What fiscal steps is he taking to support retail and high street businesses affected by the Covid-19 outbreak?”

He added: “Since being elected I have raised many times the economic and social loss that online trading is having on our towns, our cities and our high streets. And the pandemic has accelerated that issue.

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“Surely now a VAT style online sales tax is something the government must start to consider?”

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But Mr Norman, financial secretary to the treasury, said the sector had been well-supported throughout the pandemic.

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“In recognition of the extreme disruption caused by the pandemic the government has responded with one of the most generous and most comprehensive packages of support around the world - response so far totalling close to £200bn,” he said.

“In addition to affordable government backed loan financing, the Job Retention Scheme, and deferred VAT, retail businesses have also received specific support, including a 12-month business rates holiday for all eligible retail businesses in England, and retail and hospitality and leisure grants worth either £10,000 or £25,000.”

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And the Hereford and South Herefordshire MP added: “Many businesses - offline businesses - are also extremely effective offline businesses. As Adam Smith almost said, we are a nation of virtual shopkeepers.

“The government is committed to a fundamental review of business rates.

“We’ve published a call for evidence in July and invited views on reform and of course potential alternative taxes, including additional online sales taxes.

“Our intention is very carefully to consider the merits and risks of introducing such a tax and I would encourage all members to contribute their views.”

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