Tesco hands back £585million in tax relief because others need it more
Tesco is handing back hundreds of millions of pounds (Image: Media Wales John Myers)
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Tesco will repay £585million of business rates relief to the Government, saying others need the help more.
The supermarket said the tax break was hugely important to it at the time – and that Covid-19 has cost it far more than that – but that it's now in a position to hand money back.
Tesco chairman John Allan said: "We are financially strong enough to be able to return this to the public, and we are conscious of our responsibilities to society.
"We firmly believe now that this is the right thing to do, and we hope this will enable additional support to those businesses and communities who need it."
In its latest results, Tesco said coronavirus would cost it £725million this year.
Tesco described the rates relief as a "game changer" at the time, adding it was "immensely grateful for the financial and policy support".
"These funds meant that we had the immediate confidence, in the face of significant uncertainty, to invest in colleagues, and support our customers and suppliers," the supermarket said in a statement.
"Every penny of the rates relief we have received has been spent on our response to the pandemic."
Tesco described the rates relief as a "game changer"
(Image: AFP via Getty Images)
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But after 10 months, it's now in a far more stable position.
"While all businesses have been impacted – many severely so – we have been able to continue trading throughout, serving many millions of customers every day and although uncertainties still exist, some of the potential risks faced earlier in the year are now behind us," Tesco said.
Chief executive Ken Murphy said: "While business rates relief was a critical support at a time of significant uncertainty, some of the potential risks we faced are now behind us.
Back in March, panic buying and safety concerns posed serious risks to supermarkets
(Image: MEN MEDIA)
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"Every decision we've taken through the crisis has been guided by our values and a commitment to playing our part.
"In that same spirit, giving this money back to the public is absolutely the right thing to do by our customers, colleagues and all of our stakeholders."
For food retailers were hit hard at the start of the pandemic – with panic buying, pressure on supply lines, major safety concerns and the risk of mass absences from work.
Tesco said this created a "real and immediate risk to the ability of supermarkets to feed the nation".
But while they faced pressure, they also stayed open and kept working to fix the problems they faced.
Murphy added: "Our colleagues have done an exceptional job in responding to the challenges of the pandemic.
"We have invested more than £725million in supporting our colleagues, putting safety first, more than doubling our online capacity to support the most vulnerable customers in our communities, and hiring thousands of additional colleagues at a time of need."