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Handouts to large businesses - should they be revised?

(6 Posts)
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Dinahmo Thu 09-Apr-20 15:19:36

The government has given a business rates holiday to supermarkets but is this really necessary.?

Tesco's business rates amount to £700 million which is apparently equivalent to 50% of their profits for 2019. This week they announced a 60% increase to their dividends making the total dividends £657 million.

Tescos have employed a further 45,000 people and have increased the wages of staff working at the moment by 10%. They are also committed to pay £3 million per month to their food collection scheme. These are good moves but no where near the savings that they are making.

These measures were introduced fairly early by the Chancellor, long before he thought of the self employed and the small businesses. Many self employed people won't be getting any assistance other than benefits. Anybody who became self employed after 5 April 2019 won't receive the grant. There are many people who changed jobs or decided to start their own business this year - they also will get nothing other than benefits.

Napoleon called us a nation of shop keepers and in the past we were a great trading nation. Governments talk about small businesses as being the seed corn for larger businesses. if they don't review the aid packages there won't be much seed corn left to start up again.

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vampirequeen Thu 09-Apr-20 17:38:12

I don't see why the supermarkets need a bale out. They're trading as normal. They already profit from the benefits system because they pay such low wages that most employees have to claim working family benefits.

Financial support should be going to small businesses including those set up after 5th April 2019.

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Nandalot Fri 10-Apr-20 16:52:14

Tesco is still managing a large dividend to their shareholders.larger than the government bailout! Something wrong there.

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Nandalot Fri 10-Apr-20 16:52:42

Sorry forgot to post link .https://www.theguardian.com/business/2020/apr/08/tesco-sales-up-30-per-cent-because-of-pre-lockdown-stockpiling-coronavirus

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Scentia Fri 10-Apr-20 17:39:17

You must realise that this massive increase in sales will not last forever don’t you. Just because of lockdown it doesn’t mean everyone is suddenly eating 60% more food. In a few weeks sales will probably drop considerably.

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Dinahmo Fri 10-Apr-20 17:59:51

Scentia Sales have increased probably for at least 2 reasons - off licences and pubs are closed and the sales of alcohol have increased. Secondly a large percentage of their turnover has arisen because people are no longer eating out - believed to be 20 - 25% in London.

The 60% increase in their dividend has in effect been paid for by the holiday (not postponement) from payment of their business rates. It's reminiscent of the large corporations keeping wages low because workers were getting working family tax credit to top up their income. We subsidised the wftc (I had absolutely no objection to that) and that benefit the directors and shareholders.

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