Booksellers Association calls for end to tax relief for charity bookstores

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Booksellers Association calls for end to tax relief for charity bookstores 8

Finance | Niki May Young | 11 Nov 2011

The Booksellers Association has called for an end to tax and business-rate concessions for charity bookshops, saying they give an "unjust competitive advantage" over other retailers.

The statement, released this morning, argues that "charity bookshops which operate like professional businesses should not benefit from receiving tax and business-rate concessions" and that charity retailers operating in a professional manner "affect adversely the rateable values of neighbouring properties".

Tim Godfray, chief executive of the Booksellers Association (BA), said: “Trading conditions for high street retail booksellers are extremely tough in the current climate and unfair competition from charity bookshops is something our members do not need.

"If we are serious about protecting retail diversity on the high street, we need to review the strong tax and rate concessions given to charities which run shops. If a charity shop sells new goods, why should it benefit from tax and business-rate concessions?"

Healthy Planet bookstore

BA's comments were prompted by reports from its members that a new shop, opened by ecological charity Healthy Planet in Shepherds Bush, West London, had approached publishers for new stock of bestselling authors' titles.

Having opened with the aim to "rescue books otherwise destined for landfill or pulping" and to distribute for free through the store, Godfray said the charity had "strayed from its stated goal of dealing in genuinely unwanted titles and is now competing with booksellers on the high street".

However, Healthy Planet's spokesman Scott King said that there are no new titles in any Healthy Planet outlets, known as Books for Free stores, which he said are "not retailers as we don't sell any of the items".

He said the charity is "not currently" planning on introducing any new titles and, asked whether the charity would consider taking on new books, he said: "All I can say is that we do not have any new books in any of our sites. We would be happy to talk with Tim about the matter."

Healthy Planet had not been in touch with publishers with regards to buying new stock, he said.

Charity Retail Association response

The Charity Retail Association advises that almost 90 per cent of goods sold in UK charity shops are donated goods, and in relation to BA's call for the end of tax and business-rates relief, a spokewoman for the CRA said that "it is worth noting that charity shops are only able to claim rate relief if they are selling wholly or mainly donated goods".

She added: "Charity shops are not responsible for the challenges faced by independent booksellers.

"The Booksellers Association reports on its website that 31 per cent of books by value are now being sold on the internet, and 10 per cent by supermarkets. Coupled with the economic downturn, these represent much greater challenges to high street booksellers than charity shops.

"We think that independent retailers could be supported in a variety of ways without penalising charity shops, which raise around £200m for a huge range of causes in the UK every year," she said.

Place a comment

Marcus
Second hand bookshop
15 Nov 2011

As expected a completely ridiculous response from the charity sector. We have a small family second hand bookshop with trade built up over 17 years and have had 3 charity shops set up within a few hundred yards - they do not pay for their book stock, they are staffed by unpaid staff (except the manager) and in our area benefit from 100% rate relief and then tax breaks. One of these shops is selling all books at 3 for £1. How are we supposed to compete with a business that does not pay staff, does not pay rates, does not pay for its stock and does not pay tax as we do. This is unfair competition of the grossest kind. Do your charity volunteers realise that their well meant free labour is driving hardworking people out of paid employment. As a direct result of this competition we have lost around 70% of our paperback fiction trade and have had to make our only employee redundant. where is the charity in that? Our redundant worker now has no income to spend in the local economy, the rates concession means less government income when they need every penny etc etc There is a huge social and economic cost to the charity concessions that is swept under the carpet. As to the 100% of profits to charity in 2009 the Croners reward survey showed average salary of charity directors in the UK was over £70,000 per annum - they don't work for free. The Charities Commision own figures also show very few charities get more than 40% of donations going to the charitable cause and for some it is as little as 10%.

[Reply]

John Marshall
CEO
Centrepoint Outreach
17 Nov 2011
Response to [Marcus]

Like many - we are a small local charity (not related to Centrepoint London). We pay our Shop Manager and a Deputy a small salary. Our volunteers are not looking for paid employment. Most are retired people wishing to help us in our aim to serve homeless, lonely and vulnerable people. I earn less than a third of your quoted Director average and my paid colleagues less than the current 'Living Wage'. We do not generate enough income to pay any employee the true rate for the job! Last year our Drop In Centre (next to our Charity Shop) had 12,438 client visits and dealt with nearly 7,000 enquiries. By the Grace of God and the goodwill of the local community who give their time, money and donated goods (including books) we have been serving our community for over 20 years. (2010 'Boston Best Social Enterprise'). Don't tar all charities with the same brush! Outside of my day job - I give my time as an unpaid volunteer for several organisations. Try it Marcus - you might enjoy it and then be more supportive of your local charitable voluntary sector!

[Reply]

John Marshall
CEO
Centrepoint Outreach - Boston
11 Nov 2011

Don't penalise charities because it's tough on the High Street! Our one shop sell 's donated goods - we don't buy in new items. What it raises - enables the work of our Homelessness Drop In Centre. I suspect the impact of Kindle and Amazon, The Book Depository etc - is a more likely reason to make high street book retailers suffer!

[Reply]

Secondhand Bookseller
15 Nov 2011
Response to [John Marshall]

It is about time someone raised the issue of unfair competition from charity shops. We are an independent secondhand bookshop and now have 4 charity shops within a few hundred yards all selling books. They pay no rates whatsoever - the council gives an extra 20% relief on top of the mandatory 80% - i.e. they get 100% relief, they only pay the manager of the shop - everyone else is a volunteer, they do not pay for their book stock and they get tax concessions as well. one sells books (all types) at 3 for a pound. How on earth do we compete with that?
Thanks to the above we have seen 70% of our paperback fiction trade disappear and have had to make our one long-term employee redundant - so less money in the local economy, they pay no rates and little tax so less money in government coffers. I have no problem with fair competition but the current situation amounts to government subsidy of charities There is a huge hdden economic and social cost to the subsidies charities receive. Charities should pay their workers at least minimum wage and should pay rates and tax, benefits are taxable so why not charities - their tax could go to pay the benefits of those their businesses put out of paid work.

[Reply]

Carl Allen
19 Nov 2011
Response to [Secondhand bookseller]

Please complain to the regulatory body on competition.

[Reply]

Richard Piper
Head of Improvement and Innovation
NCVO
11 Nov 2011

The Charity Shops Association is spot on here. This nonsensical sort of comment about charity shops has been going on for 15 years now. We can appreciate the challenges faced by retailers of any sort, but the charge that the current situation is 'unfair' is utterly wrong.

If a book retailer decides to sell mainly second-books, is able to engage volunteers, and decides to give 100% of her or his profits to charity, then they can also potentially benefit from the same tax reliefs as charity shops. But will they choose to do that? I doubt it.

[Reply]

Stolen
11 Nov 2011
Response to [Richard Piper]

The second paragraph of Piper's comment is to be read as sarcasm?

[Reply]

Barbara
16 Nov 2011
Response to [Stolen]

No, it's just a level of ignorance how business looks like.

[Reply]

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