Revitalizing Town Centres By Imposing Higher Taxes On Online Businesses
An individual or business must always expect and prepare for a tax audit. Even the most random audits can cost a lot of money. An effective protection against considerable costs is Audit Shield, an insurance that covers professional accounting fees should a random audit be conducted on an individual or the business.
According to Andy Street, the mayor of West Midlands, online retailers like Amazon must pay more taxes so that struggling town centres can be transformed into free trade zones. Retailers on high street are being crippled by the outdated business rates that need to be overhauled. The business rates were designed in 1990 when businesses earned money in a different way.
A committee is currently evaluating the impact of business rates which is the commercial equivalent of council tax. Alternatives must also be considered to the property-based tax. Business rates generate about £30 billion a year for the exchequer but it is also being blamed for exacerbating the decline of high street. Retailers were hit hard by the recent revaluation in some parts of the country where property values soared.
The digital service tax that was announced by Chancellor Philip Hammond will target the big US tech firms like Google, Facebook and Amazon. The tax that will be enforced next year will generate about £400 million annually.
Hammond also suggested that town centres can be revitalized by creating free trade zones with additional policing, infrastructure and public realm improvements that will be paid for by imposing higher taxes on online businesses. Local authorities will be given extra powers to reduce business rates or relax planning rules.
On the other hand, critics of business rates argue that they are more in favour of online retailers operating from cheaper out-of-town locations. High street is being affected by the shopping habits of consumers who prefer to browse products online than brick and mortar stores.
A business can expect to pay a substantial amount in professional fees in case it is audited or investigated by the authorities. A cost effective solution is Audit Shield that will protect the business from the professional costs of producing the required information. Ask your accountant whether this insurance product is being offered.
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