The boss of personalized gift retailer notonthehighstreet has warned that any budget decision to impose an online sales tax would be a “mistake” and penalize small businesses already affected by the pandemic.
Claire Davenport, general manager of the Organized Online Marketplace, said it would come at the worst time for small business owners, with many going online due to the pandemic or setting up internet businesses after losing their jobs during the crisis.
The group has seen its community of handpicked small business sellers quadruple in 2020, with e-commerce becoming a lifeline for many businesses and entrepreneurs.
Ms Davenport’s comments come amid growing division in the retail industry over the potential introduction of an online sales tax, as reports suggest the Chancellor is looking into how the levy might work in the Kingdom United before its March 3 budget.
Some are calling for the tax to replace the outdated and much-criticized corporate pricing system and help level the playing field with Internet retail giants.
This has been highlighted by the pandemic, which has hammered through brick and mortar chains.
But others fear it will stifle a burgeoning industry that will help the economy recover from Covid-19.
Speaking to the PA News Agency, Ms Davenport said: “In my opinion, this is a mistake.
“A lot of small businesses have spent the past year trying to get online and start a business – people who weren’t running a business before or had to change course because they needed to go. line.
“You don’t want to embarrass the people doing this.
“Penalizing small businesses that are trying to follow a trend that is happening in the market is not fair.”
Notonthehighstreetm, which was founded in 2006, saw a 50% increase in seller inquiries last year, with a 78% increase in May.
It also added nearly another million new customers in 2020 as online retail exploded with the closure of entire swathes of Main Street due to Covid-19 restrictions.
Rather than hitting small businesses with online levies, she said the budget should instead seek to provide more support for entrepreneurs and independent traders and help small businesses “start and grow”.
Notonthehighstreet has grown to meet growing demand, hiring 77 more employees last year and nearly doubling its product and technology team.
It was bought in early February by US private equity firm Great Hill Partners, which has backed companies such as home furniture retailer Wayfair and digital travel group Momondo.
The retailer wants to further increase the number of sellers and expand its lines of housewares and garden products, as well as food and beverages – which saw their combined sales double last year.
The group is based in Richmond, southwest London, and has some 3.6 million customers and more than 5,000 sellers in its market.
