Chancellor John Healey Plans £1bn Online Marketplace Tax Crackdown

Chancellor John Healey plans to introduce a £1bn tax crackdown on online marketplaces, including Amazon, eBay, and Temu, to fund business rates cuts for high street retailers. Under the proposed policy, e-commerce platforms must collect VAT at source for sellers with annual revenues exceeding £90,000, a measure designed to stop foreign retailers from using UK shell companies to avoid tax.

The Treasury intends to use these revenues to provide tax breaks for small high street shops. This approach replaces a previously considered tax on out-of-town warehouses, which had faced strong opposition from retail leaders. Jason Tarry, executive chairman of John Lewis, argued that such a warehouse tax would reveal a fundamental misunderstanding of how modern high streets work.

Amazon.com Inc. expressed support for the measure, stating that closing the loophole will raise significant revenue for the exchequer and simplify compliance. However, the company estimates the actual revenue will be approximately £700m, falling short of the government's £1bn projection.