M&S boss Machin hits out at ‘economically illiterate’ taxes

05/03/2024
Aberdeen's M&S store on St Nicholas Street will close in 2025

MARKS and Spencer chief executive Stuart Machin has issued a plea for a better understanding of the importance of the retail sector, as existing policy “makes being an employer of people and running stores really hard”.

In a social media post, he urged with the UK government to fix the “broken” business rates system and to scrap the “tourist tax” by reinstating the tax-free shopping scheme that allowed overseas visitors to reclaim 20% VAT on purchases.

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Ahead of the Budget on Wednesday, the retail boss said tax rises due to come into effect 1 April affecting premises in England needed revising as the tax “balance is wrong and stymying growth”.

He added that increasing rates “at a time when the government is looking to tackle inflation, retailers are working hard to offer customers the very best value and people are struggling with the cost of living — is economically illiterate.”

The impact of current financial issues can be seen in Marks & Spencer itself, which recently confirmed the closure of its flagship Aberdeen store on St Nicholas Street, following the withdrawal of other chains such as John Lewis, Debenhams and BHS from Aberdeen’s city centre. M&S closed 68 stores in the UK in 2021.

Meanwhile, the British Retail Consortium, the Association of Convenience Stores, British Beer and Pub Association, British Independent Retailers Association and UK Hospitality have all written to the chancellor asking him to align the business rates rise with April’s CPI not November’s, which is higher.

In Scotland, deputy first minister and finance secretary Shona Robison confirmed the poundage rate would be frozen for businesses with a rateable value up to £51,000 in its budget in December.

However, the Scottish Retail Consortium (SRC) has highlighted that a Scotland-only business rates surcharge on all firms occupying medium-sized and larger premises is set to cost firms a cumulative £125 million over the next two years.

The body added business rate for medium-sized and larger commercial premises in Scotland will soar to a 25-year high from April.

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