M&S warns the chancellor of potential “damages” from the online sales tax

Marx and Spencer wrote a letter to the Chancellor warning of the potential damage that an online sales tax would cause on Main Street.

However, according to M&S CFO Eoin Tonge will “further damage the main streets” as the multi-channel retailers are likely to cut their “least profitable” main street sites to help offset the cost of the new tax.

In the letter, as seen from BBCTonge said: “The introduction of an additional tax on retail – already congested – will simply mean that retailers are cutting their clothes accordingly.

“… This rationalization will always start with the least profitable parts of the business – which in the case of multi-channel retailers will more often be High Street stores,” Mr Tonge said.

He added: “So it is likely that far from helping High Street, the online sales tax will further damage shops and our main streets, especially in areas that require new investment to bring them back to life.”

Tonge’s view comes from a recent study by Colliers “Huge support” to the introduction of a form of sales tax online to reduce the pressure on business tariffs by retailers.

He revealed that 89% of respondents are in favor of the new tax, with only 11% disagreeing.