Ocado on the offensive over online tax debate

Kasmira Jefford
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OCADO boss Tim Steiner yesterday accused high street retailers of using the debate surrounding Amazon and Starbucks’ tax affairs to complain about business rates.

Steiner said the fact that one of the multi-national companies was an online firm had prompted retailers to “jump on the band wagon” and call for online businesses to share the burden of rates.

“We mustn’t allow some struggling bricks and mortar retailers to use it in a different argument and spin it into an offline online one,” he told City A.M.

“Why would you penalise a great business like Asos because some UK retailers are complaining? We should support businesses that make a difference in the long term,” he added.

His comments came as the online grocer reported a £3.8m pre-tax loss in the six months to 19 May, compared with a £200,000 profit in same period last year.

Duncan Tatton-Brown, finance director, said the wider-than-expected loss was due to £2.8m of costs relating to its Morrisons online tie-up and the launch of its second distribution site in Warwickshire.

Excluding these items, the group made a pre-tax loss of £1m compared with a £400,000 profit last year.

Earnings before interest, tax, depreciation and amortisation rose 28.7 per cent to £19.2m, while revenues were up 15.2 per cent to £382.7m.

Rates were also addressed yesterday at a Business, Innovation and Skills Committee hearing, with Alliance Boots health and beauty boss Alex Gourlay warning the tax burden was causing “significant structural problems” on the high street.