Sainsbury’s boss Mike Coupe has urged the Government to overhaul its “archaic” business rates system ahead of this afternoon’s Budget.
The supermarket giant’s chief executive insisted the current system was “not fair” and out of kilter with the “current world of business.”
Speaking following his keynote speech at Retail Week Live this morning, Coupe hit out at the business rates system, with the first revaluation in seven years due to swing into action on April 1.
After using his presentation to tell the story of Sainsbury’s acquisition of Argos so far, Coupe said of the changes: “We are a slight net loser, but the point that we would make is, not necessarily that business rates should be somehow moved around between online and bricks-and-mortar retailers or between big retailers and small retailers, but that the whole business rates regime needs to be fundamentally reformed.
“It’s an archaic tax, it dates back to Tudor times and it’s not a tax which is relevant to the current world of business.”
Coupe added: “Sainsbury’s is the 75th largest corporation in the UK. We are the sixth largest taxpayer.
“We pay £500m a year in business rates – and that’s without Argos. If you add Argos back in, that’s an even bigger number.
“We think, in the world that we operate in, that’s not fair.
“It’s not fair that the retail world in general pays a disproportionate burden of business taxation because it happens in many cases to have more physical properties.”
Coupe insisted that the Brexit negotiations had not dented his confidence about how successful the Argos deal would be, because Britain’s departure from the EU will not change shopper habits.”
He reaffirmed his belief that the acquisition, which was completed last September, would deliver £160m of synergies and 250 Argos concessions inside Sainsbury’s larger stores by the end of the third year.
Coupe added: “The easy bit was acquiring the business.
“It didn’t feel like it at the time – it was a long year – but actually, once we got it over the line, the action really started.
“Our job is to execute, as fast as we possibly can, the plan that we laid down.
“By the end of this week, we will get to around 41 Argos stores within stores and our mission is to get to 250 within the next three years.
“We already have over 200 collection points in our supermarkets and we plan to roll out click and collect into all Sainsbury’s stores, not just our large shops, but also our convenience shops.”
He added: “We are already getting on with it. I am 100% confident we can deliver the synergies and, if anything, our ambition would be to roll out faster than we initially envisaged.”