AO World (AO.)

Up
Share Price:
254.60p
Market Cap:
1,220.50m
Change Today:
10.60p
Sector:
Retailers

UK plans online tax and 'excess profits' raid - report

By Sean Farrell

Date: Monday 08 Feb 2021

LONDON (ShareCast) - (Sharecast News) - Shares of AO World, Ocado and Asos and fell on Monday after the government was reported to be considering an online sales tax and a separate raid on "excessive profits" made during the Covid-19 crisis.


The Sunday Times said Treasury officials had called technology companies and retailers to a meeting before the budget in March to discuss how an online sales tax would work.

Internet shopping has exploded during the crisis as consumers have stayed at home and many shops have been forced to close for long periods. The UK's high streets were already in trouble before the pandemic forced the collapse of groups such as Debenhams and Philip Green's Arcadia.

Companies such as Amazon, Ocado and Boohoo have boomed during the crisis and officials are reported to see an online sales tax as a way to shift the balance towards struggling physical retailers. The British Retail Consortium has said such a move would also hit physical retailers with online operations but Tesco and other big retailers have supported the idea.

Online spending makes up about 30% of total retail sales in the UK, up from 20% a year ago, as record numbers of shops are forced to close, casting doubt on the future of Britain's high streets and town centres. The government is reviewing business rates, a long-running source of frustration for retailers, before the spring.

"Our business rates review call for evidence included questions on whether we should shift the balance between online and physical shops by introducing an online sales tax," the Treasury told the Guardian. "We're considering responses now."

Online electricals retailer AO World's shares fell 4% to 321.5p at 09:36 GMT and Asos dropped 3.4% to 47.33. Boohoo fell 4.9% to 347.2p and Ocado dipped 1.3% to 27.72.

Neil Wilson, chief market analyst at Markets.com, said: "This may raise a question about opportunistic tax policy (the government is meant to be pro-business). However, most people feel online retailers are not paying their fair share and the burden is falling too much on struggling high street stores. It's never made sense that bricks-and-mortar businesses pay more in tax than the very rivals who are stripping away their market share."

Amazon paid 293m in tax to the UK Treasury last year on sales up 26% to 13.7bn, prompting renewed calls for the company to contribute more towards the company's infrastructure, health service and other government spending that supports its business.

Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

 

AO World Market Data

Currency UK Pounds
Price 254.60p
Change Today 10.60p
52 Week High 433.50p
52 Week Low 74.30p
Volume 861,202
Shares Issued 479.38m
Market Cap 1,220.50m

Performance Indicators

Compare performance with the sector and the market.

Key
Vs Market
Vs Sector
Value
market
  1. half market star
  2. empty market
  3. empty market
  4. empty market
  5. empty market
sector
  1. half sector star
  2. empty sector
  3. empty sector
  4. empty sector
  5. empty sector
Price Trend
market
  1. full market star
  2. full market star
  3. full market star
  4. half market star
  5. empty market
sector
  1. full sector star
  2. full sector star
  3. full sector star
  4. full sector star
  5. empty sector
Income
Not Available
Growth
market
  1. full market star
  2. full market star
  3. full market star
  4. empty market
  5. empty market
sector
  1. full sector star
  2. full sector star
  3. full sector star
  4. half sector star
  5. empty sector
Price Chg 6m
market
  1. empty market
  2. empty market
  3. empty market
  4. empty market
  5. empty market
sector
  1. empty sector
  2. empty sector
  3. empty sector
  4. empty sector
  5. empty sector
P/E
Not Available
PEG
market
  1. full market star
  2. full market star
  3. full market star
  4. empty market
  5. empty market
sector
  1. full sector star
  2. empty sector
  3. empty sector
  4. empty sector
  5. empty sector
Dividend Yield
Not Available
EPS Growth
Not Available
Operating Margin
market
  1. full market star
  2. half market star
  3. empty market
  4. empty market
  5. empty market
sector
  1. full sector star
  2. half sector star
  3. empty sector
  4. empty sector
  5. empty sector

What The Brokers Say

Strong Buy 2
Buy 0
Neutral 2
Sell 0
Strong Sell 0
Total 4
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.