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Business

Amazon “gaming the system” for booksellers

The online retail giant’s business rates in the UK were revealed as part of an enquiry into internet regulation.

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Despite a small rise in independent bookshops, business rates continue to plague sellers

Amazon paid business rates of £63m in the UK in 2018 despite recording £8bn in sales, a fact which The Booksellers Association (BA) says is “systematically ruinous for traditional retailers.”

Business rates have long been an issue for the book trade and despite a successful year for books, many smaller bookshops are suffering as a result of sky-high rates.

Speaking to The Bookseller, managing director at the Booksellers Association, Meryl Halls, comments: “The fact that Amazon have finally been forced to declare the amount they pay in business rates reinforces the point that their in-built advantages are breathtakingly large and systematically ruinous for traditional resellers.”

“High street retailers are sick, frankly, of being put in the position of constantly shouting ‘it’s not fair’ - it’s clearly not fair, but in the end Amazon are only gaming the system.

“The system needs to change, and the government needs to act to reinvent a rates and taxation system that is now broken beyond repair, anachronistic, no longer fit for purpose – and to act quickly and decisively if we are to avoid seeing the demise of more high street retail businesses, and the long-term jeopardy of all high streets.”

The system needs to change, and the government needs to act to reinvent a rates and taxation system that is now broken beyond repair

Lesley Smith, director for public policy at Amazon UK and Ireland, gave evidence at a committee meeting in Parliament regarding regulation of the internet where she was forced to reveal the firm’s business rates bill.

In a statement on Amazon’s website, the company says: “As part of the broader debate around business rates, the story of Amazon’s contribution to the UK economy, through jobs, investments and business rate payments, hasn’t always been clear.

“In the past, some reports about the business rates that Amazon pays in the UK have been based on just a small number of our fulfilment centres in England and Wales, and did not take account of our substantial investment right across the country.

"We have close to 100 UK sites, and last year Amazon paid business rates of more than £63 million – tens of millions of pounds more than estimates and more than is paid by many well-known high street retailers.”

The news comes as independent London bookshop Big Green Bookshop announced it would be closing its physical store and moving online, citing “monster” rates and rent. Whilst the BA has reported a rise in independents through membership, Halls says that booksellers are still facing an increasingly challenging landscape.”

If you have a news story, email summer@linkpublishing.co.uk or follow us on Twitter to have your say.


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