Tesco CEO: ‘Amazon Tax’ Required To Ensure Level Playing Field In Retail

By Steve Wynne-Jones
Share this article
Tesco CEO: ‘Amazon Tax’ Required To Ensure Level Playing Field In Retail

Tesco chief executive Dave Lewis has told The Mail on Sunday that the UK government needs to ensure that digital-only retailers such as Amazon are taxed accordingly, in order to ensure the long-term health of retail in general.

“Three years ago I talked about a potential lethal cocktail of pressures in the retail industry, and now you are seeing that come to fruition,” Lewis told the paper.

“The tax burden has reached the point where companies are going bust. Has the government thought through what happens when retail starts to decline and if the job losses start to become significant?” he added.

‘Amazon Tax’

Lewis's comments follow those by UK Chancellor Philip Hammond, who suggested that an ‘Amazon tax’, as it has been dubbed, could be necessary to keep struggling bricks-and-mortar retailers afloat.

The charge would be set at around 2% on all goods sold online, according to reports.


According to Lewis, the introduction of such a measure could mean that business rates could be dropped across the sector, lightening the load for the industry.

“If I were the Chancellor, I’d be saying how do I keep this industry going so I could keep this [tax] take for longer, because if I’m not careful I’m going to kill it,” he told the paper.

“Retail is truly national. If you look at gross Value Added Tax, direct tax, indirect taxes, employment, the number of suppliers to our stores and our business, the contribution in terms of the wider community – the role of retail in the economy is significant and it will be affected by this,” he added.

Apply To Food?

Commenting on the proposed 'digital sales tax', Greg Lawless of Shore Capital said, "We wonder whether any such digital sales would or could be applied to products purchased outside the UK. Equally, would the Chancellor apply a digital tax to food?


"Furthermore, in terms of the UK’s strong start-up rates in online retail, would there be a sales exemption threshold applied for start-up and smaller companies? As we say, the Tesco call for an Amazon sales tax raises lots of interesting questions, and given that HM Treasury has also introduced tax on overseas royalty payments, all eyes will be focused on the Budget on Monday 29 October 2018," added Lawless.

© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.

Get the week's top grocery retail news

The most important stories from European grocery retail direct to your inbox every Thursday

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our terms & conditions and privacy policy. You can unsubscribe at any time.