Proposals for a new ‘supermarket tax’ – which initial studies suggested could generate £7.2m to help support district shopping centres in Leeds – are set to be rejected by councillors for fear it could end up driving retailers to go elsewhere.
Leeds City Council’s executive board will discuss the idea of a Supermarket Levy, on stores with a rateable value of more than £500,000, at its meeting on Wednesday.
The idea has been put forward by national lobbying group Local Works – a coalition of over 100 national organisations which is campaigning to promote the use of the new Sustainable Communities Act.
Campaigners say any money raised can be used to support local town and district shopping centres that have suffered during the economic downturn.
However, a report to be presented to councillors - although acknowledging that “the potential sums generated by the levy are considerable” – says that introducing such a tax would be “ill-timed” and would be “too blunt a tool”.
Supermarkets currently employ an estimated 10,000 people in the city.
The report says: “There is little doubt that the rise of out of centre superstores has had an overwhelmingly negative impact on our town centres. The levy is an opportunity to invest more money into our centres and could be a crucial factor in breathing life back into our towns. However supermarkets are not the only factor in town centre decline.”
The report adds that the rise of online shopping, and the findings of the Mary Portas Review – that many district centres just need to try harder to attract customers back – are also major factors. However the report stresses the council “will continue to work with small, independent businesses within the existing town and centre programme”.
The Association of Town Centre Management (ATCM) has said there are “serious issues to consider before enabling this levy”. “The increased costs to business are high...they might leave...or implement redundancies to reduce costs.”