Marks and Spencer has reportedly warned the Government that a proposed online sales tax would be detrimental to the high street and ultimately do more harm than good.
In February, the Government launched a consultation into possibilities for an online sales tax to ease the business rates burden on high street stores.
In a letter to Chancellor Rishi Sunak, reportedly seen by the BBC, the retail giant’s chief financial officer Eoin Tonge said: “Introducing an additional tax on retail, already overburdened, will simply mean retailers cut their cloth accordingly.”
“This rationalisation will always start with the least profitable parts of a business, which, in the case of multi-channel retailers, will more often than not be high street stores.”
He insisted that this would not benefit high street stores, but cause them “damage.”
The Treasury has reportedly not yet decided if it will implement the tax.
Sunak promised the consultation at the Budget in October, following businesses’ concerns of a potential tax imbalance between physical and online retailers.
Several major high-street retailers have repeatedly called for an online sales tax, as bills for online-only retailers are far lower.