The UK government has published an early-stage consultation to explore the arguments for and against an Online Sales Tax (OST). It follows concerns reported by businesses of a potential tax imbalance between in-store retailers and online.

Although there has been no decision as yet on whether to go ahead with the tax, the consultation aims to look at potential designs and impacts on consumers and businesses of its implementation.

The Government said that given the significant changes in the retail market and shift online, it is right to reassess the taxation of this sector.

Stakeholders are invited to give their views on the challenges on the design of an Online Sales Tax, including which products and services would be in scope and whether it would be a flat-fee tax based on the number of transactions or deliveries, or a revenue-based tax.

The consultation runs until 20 May 2022.

Visit the online sales consultation

Read the business rates review final report