Free ATMs 'at risk' say retailers
Thousands of free cash machines at supermarkets and petrol stations could disappear after a tax ruling means retailers could have to pay far more tax on ATMs.
Several big retailers have launched an appeal to stop a new tax law from making them pay more business rates on ATMs.
Tesco, Sainsbury’s and the Co-operative Group are among the companies taking the Government to the Court of Appeal in an attempt to stop a legal ruling that would mean they have to pay more tax if they have cash machines.
The legal ruling in April upheld a decision from 2013 that cash machines that are built into the front of shops or petrol stations should be liable for a separate business rates bill.
If the ruling is upheld then it could cost the retail industry almost half a billion pounds in extra business rates.
The ruling was backdated to April 2010, meaning shops were landed with huge unexpected tax bills.
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Cost of maintaining ATMs
Retailers currently pay £39.3 million a year to have cash machines – that’s an average £2,800 per ATM, according to rents and rates specialist CVS.
The decision to uphold the 2013 decision ruined retailer hopes that they would be able to get back the £200 million they’ve already paid for these extra business rates, and save them a further £200 million over the next five years.
The new business rates don’t apply to freestanding cash machines, just ones built into the front of a building.
The change means the number of ATMs liable for business rates soared from 3,140 in 2010 to 14,068 this year.
The ruling could mean many of those ATMs disappear.
The Association of Convenience Stores has warned that the tax will hit small retailers particularly hard and could mean ATMs are removed, or they start to charge people to use them.
Speaking of cash machines, if you do need to draw money it’s vital you make sure the ATM hasn’t been tampered with by fraudsters.
Spot any one of these five tell-tale signs and we’d strongly advise you head off in search of another (hopefully fee-free) machine.
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Why is it that HMRC are happy to tax what is effectively a service and makes no profit, yet does virtually nothing to make the big American companies like Amazon and Google to pay their fair share of tax?
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It seems very odd to tax a service which in itself doesn't generate any profit. In fact, the ATM is an outgoing for the store because an employee has to keep it stocked with notes, it uses electricity and also requires a secure network connection. Not to mention it's a magnet for any robber armed with a JCB. True, people withdrawing cash might then go and spend some of the withdrawn cash in-store, but if they do then that would be reflected in the store's profits - which are taxable. And don't the majority of people use a credit/debit card for the weekly shop anyway?
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I have to admit to knowing about this fiscal frivolity for some time and that is why I give ATMs a miss. My local bank branch has a free standing machine so no problem but, as has already been explained above, the Authorities are making another ASS of themselves - no doubt pushed by Messrs May & Hammond.
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03 July 2017