Councils have called for new powers to tax large supermarkets, in a bid to raise funds for local services and economic growth.
With the support of 19 other local authorities in England, Derby City Council is leading calls for retail outlets with an annual rateable value of no less than £500,000 to pay an increase levy of up to 8.5%.
Extra funds would be retained by the local town hall to promote regional economic activity and fund services.
Reports suggest the so-called ‘Tesco-tax’ could raise up to £400m a year.
Cllr Ranjit Banwait, leader of Derby City Council said: ‘This levy is already benefitting communities in Scotland and Northern Ireland. The revenue that we’ll be able to generate will mean that we can improve local communities for example support local business and improve public services.
‘Research has shown that 95% of all the money spent in any large supermarket leaves the local economy for good, compared to just 50% from local independent retailers; this levy is a modest attempt to ensure more of that money re-circulates within and continues to contribute to local jobs and local trade.’
However the Department for Communities and Local Government said that it had ‘ruled out’ such a bid under the last round of the Sustainable Communities Act proposals. ‘There are much better ways to support small shops,’ it said.
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