Thursday, 2 March 2017

City AM jumps the shark, again.

The Chief Executive of the British Retail Consortium in City AM:

Retailers pay a quarter of all business rates and it is the single largest tax paid by the industry.

My comment, let's see if they publish it...

You really are ramping up the propaganda. Quite clearly it isn't. Retailers pay £7 billion business rates (quasi rent) and over £40 billion in VAT, with tens of billions in PAYE/NIC (not sure how much).

So in truth, business rates is the fourth largest tax paid by retailers, and the economic incidence is of course not on the business itself but on the owner of the building - tenants are shielded from business rates in the long run because every £1 rates pushes down rents by £1.

Funny how you don't complain about rent being a "disincentive to investment" and all that nonsense.

5 comments:

Physiocrat said...

The incidence of VAT is partly on businesses. Got to an airside shopping mall and check the prices.

The higher profitability is reflected in airside rents and in the profits received by the airport owners. Since these are taxable, VAT abstracts revenue from other income streams.

It may well be that scrapping VAT would result in no loss of revenue to the exchequer.

Mark Wadsworth said...

P, the incidence of VAT is almost entirely on business, unless demand is price insensitive - fags, booze, petrol.

Ben Jamin' said...

Red Socialism = Union protection from the market

Blue Socialism = Business/Freeholder protection from the market

If the Labour Party had any brains, they'd employ the same language as the Tories in order to turn the tables on them.

Mark Wadsworth said...

BJ, neither brains nor heart.

Ben Jamin' said...

No, its still not up.