The housing, communities and local government committee has said “dated policies” and an “unfair tax regime” needed reforming to allow high streets and town centres to flourish in its report into the future of the UK high street.
The report highlighted the disparity between taxes paid by bricks-and-mortar retailers and online businesses as it said high street retailers were paying “more than their fair share”. It also said Amazon was paying just 0.7% tax on its UK turnover compared to physical retailers which paid between 1.5% to 6.5%. For this, it recommended an online sales tax.
The committee said in the six months since its inquiry into the high street began, “barely a week went by” without a major retailer collapsing or posting a drop in profits.
It recommended a reduction in business rates for retailers on high streets and in town centres and suggested a 12-month holiday from rate increases to encourage and allow for investment into property.
It also said the high street needed to adapt to survive and shift its focus to green space, leisure and arts and culture instead.
Chair of the committee, Clive Betts MP, said: “The growth of online shopping has profoundly changed retail in the UK, and the knock on impact on high streets has been stark.
“It is likely that the heyday of the high street primarily as a retail hub is at an end. However, this need not be its death knell. Local authorities must get to grips with the fact that their town centres need to change; they need to innovate, setting out a long-term strategy for renewal, reconfiguring the town centre and finding new ways of using buildings and encouraging new independent retailers.”
He added: “Local authorities must have the foresight to develop evolving strategies tailored to the needs of their local communities and drive the large-scale transformation needed. Central government must give them the powers, and back them financially, to allow them to put this into practice.”