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Budget 2012: Newsagents attack rise in tobacco duty rates

21 March
16:31 2012

Independent newsagents have hit out at chancellor George Osborne for pressing ahead in today’s Budget with plans to suspend all Sunday trading restrictions during this summer’s Olympics and Paralympics.

The National Federation of Retail Newsagents (NFRN), which represents 16,000 independent newsagents and convenience stores, has slammed the decision.

NFRN president Kieran McDonnell said: “To use the London-centric Olympics to potentially change the face of retail nationally and gift yet more market share to the supermarkets will be a truly tragic legacy.”

The NFRN claimed that by conceding to the supermarket lobby, George Osborne’s move would cost the independent sector £480m while contributing only £180m to the economy.

Although mooted as a temporary measure, the chancellor has hinted that the Olympic ‘experiment’ – which is opposed by 89% per cent of the public; 91 per cent of shopworkers and has been rejected every time it is debated in Parliament – may be used as a test case to ‘learn lessons’, suggesting a more permanent suspension would be considered.

Concern is also expressed at the 5% above-inflation rise in tobacco duty as this will merely push hard-pressed consumers to the illicit market at a cost to both the Treasury and legitimate businesses.

The NFRN also claimed the government’s failure to make any sort of announcement on minimum alcohol pricing again played into the hands of the supermarket lobby, which has strongly opposed measures to curtail its practice of below-cost selling, which smaller shops cannot hope to compete with.

On the plus side, independent retailers welcomed proposals to relax employment law, as these would remove both expense and bureaucracy, and to reduce corporation tax by a further 1% per cent to 24% in April.

Also welcome is the proposed introduction of the promised credit easing programme in the Autumn Statement, although the NFRN is cautioning Osborne to be careful in his definition of small businesses to ensure that micro-businesses can compete for loans against companies with larger turnovers and resources.
McDonnell said: “While we welcome the intention to increase lending to small businesses, we would question the mechanisms through which these are planned to be delivered.”

He added: “While there is some good news for small shops in an extremely delicate economy, there are also huge causes for concern that would lead me to think that this Budget ‘unashamedly backs business’ through prioritising the interests of big business.”

Source: NFRN

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By Mike Dennis

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