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Amazon faces soaring costs as UK Chancellor hikes warehouse rates

By Nagasunder in Amazon News, posted November 19, 2022

Amazon is one of the companies that will be hardest hit by the UK Chancellor's decision to raise rates at large distribution centres.

Following the measures announced in Jeremy Hunt's autumn statement, large warehouses will face an average rate increase of 27 percent.

Altus Property Advisors predicted that Amazon's Tibury warehouse in Essex would see a 74 percent rate increase, rising from £7.1 million to £12.3 million per year.

The new measure is also expected to affect supermarkets such as Tesco and Sainsbury's.

The rate increase follows Hunt's introduction of £13.6 billion in business rates relief for brick-and-mortar retailers.

The Chancellor scrapped the proposed online sales tax; this was intended to address the disparity between high street and online retailers.

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Clare Bottle, CEO of the United Kingdom Warehousing Association, whose members include Amazon, Clipper Logistics, and DHL, called the tax hike "unfair," "painful," and "disproportionate."

She said: “Warehouses are big buildings and they are already paying their fair share.”

Bottle said that the move overlooked the small margins that countless warehouse companies work to.

Source: Retail Gazette

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