Ozva AdminAmazon’s UK tax bill increase could rise by £29m next year as a result of merchant rate changes that are set to hit warehouses and online retailers the hardest.
The online retailer is likely to be among the companies facing big tax hikes following the chancellor’s decision. fall statementaccording to the analysis of the real estate consultant Altus Group.
Meanwhile, flagship department stores and hotels could save millions on their tax bills, and brick-and-mortar retailers get further support as the government changes the merchant fee system and reassesses more than 500,000 retail properties in England and Wales.
The new assessed values, which are used to calculate business rate tax, will be based on property values as of April 1, 2021. This means that “winners” of the pandemic, such as online retailers , they will have a tax increase while taxes could fall for the “losers” of the pandemic, such as physical stores.
One of Amazon’s delivery stations in Longtown, Cumbria, will face an increase in its taxable value of 145%, Altus said. Amazon’s general business fees could increase by around £28.75m next year and cost the company around £100m in extra tax over three years, taking inflation into account and before a tax break is claimed.
However, Altus warned that the smaller occupants of industrial buildings and warehouses risked financial collapse with tax increases adding to skyrocketing costs.
Its UK chairman, Robert Hayton, said: “Most industrial buildings are not huge sheds occupied by online retailers, but incubators of home economies, start-ups and manufacturers that support employment.
“It appears that the appraisers for the new preliminary listings have taken a one-size-fits-all approach, and this could be very damaging.”
He added that the “market distortion” that followed the Covid period is likely to cause difficulties for many already struggling businesses.
In a letter to the Chancellor, Jeremy Hunt, the UK Storage Association said: “The previous valuation date of April 2021 is unfair – storage was supporting the economy during lockdown and consequently values were disproportionately high. compared to other sectors.
On the other hand, department stores Harrods and Selfridges, where values have plunged since the pandemic, could see combined savings of around £15m.
The government said it was tackling the “bricks vs. clicks” tax imbalance, designed to support the high street and ensure retailers don’t overpay taxes when their property values have plummeted.
An Amazon spokesperson said: “We made a total tax contribution of £2.77bn during 2021 – £648m in direct taxes and £2.13bn in indirect taxes.
“According to PwC analysis, Amazon ranks in the top 15 private sector taxpayers in the UK for taxes borne and collected, as well as overall total tax contribution.”
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