TaxPayers’ Alliance reveals £56 cost of online sales tax

Embargoed: 00:01 Wednesday 29 July 2020

 

  • TaxPayers’ Alliance research finds costs of reported online sales tax. 

  • It would hit the poorest and most vulnerable hardest, with deliveries being a lifeline for millions. 

  • The campaign group opposes the chancellor’s constant war on shoppers.


New analysis from the TaxPayers’ Alliance reveals plans for an online delivery tax could cost the average household at least £56 per year in unnecessary charges.

Reports suggest HM Treasury is considering introducing an online sales tax, either with a 2 per cent levy on goods sold online or a mandatory charge on consumer deliveries. Both proposals would raise costs for consumers, conflict with changes to planning law reforms and ignore changes in consumer behaviour. The poorest and most vulnerable would also be more affected.


Click here to read the full briefing

 

Despite online deliveries being a lifeline for older and more vulnerable people during the coronavirus crisis, analysis shows households could see an extra £56 per year paid in tax because of a 2 per cent levy for online purchases.

For those in the lowest decile of household incomes, an online purchase levy would be particularly damaging. The poorest 10 per cent of households lose almost half of their gross income to direct and indirect tax, with the levy charging them an extra £20 per year in tax.

The second option the chancellor is considering is reportedly a mandatory delivery charge. The delivery industry suggests that a £2 charge could be levied, or 3 per cent of the value of a £62 shop. If this was applied for a monthly delivery, households would pay an extra £24 per year in tax.


Click here to read the full briefing

 

Duncan Simpson, research director of the TaxPayers' Alliance, said:

"Online orders have been a lockdown lifeline for millions, but now the chancellor is hoping to hit them with an unwanted delivery tax. 

"Hard-pressed consumers can't win. If people drive to the shops, they're whacked with fuel duty and parking levies. Meanwhile, the digital services tax will push up costs of online purchases, and under these proposals the poorest taxpayers could also be charged for online deliveries and returns too. 

"The constant war on shoppers has got to stop."


TPA spokesmen are available for live and pre-recorded broadcast interviews via 07795 084 113 (no texts)

 

Harry Fone
Campaign Manager, TaxPayers' Alliance
harry.fone@taxpayersalliance.com
24-hour media hotline: 07795 084 113 (no texts)


Notes to editors:

  1. Founded in 2004 by Matthew Elliott and Andrew Allum, the TaxPayers’ Alliance (TPA) fights to reform taxes, reduce spending and protect taxpayers. Find out more about the TaxPayers' Alliance at www.taxpayersalliance.com.

  2. TaxPayers' Alliance's advisory council.

  3. The tax burden in the UK is now at a 50-year high and whilst efforts have been made to lower the amount of direct taxes that are paid by the poorest, such as by increasing the personal allowance, the burden of taxes falls disproportionately on those who can least afford it. Read more here.

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