The taxman is planning a levy on cash machines that could lead to thousands being closed in rural locations.
ATMs outside stores attract extra business rates and officials want to extend this charge to machines inside a shop or pub.
Colliers International, a leading commercial property firm, believes the move would add £5,000 to an average retailer’s rates.
Industry sources estimate the tax grab will cover 40,000 machines, many of them free to use.
A new levy on ATMs could cause thousands to close down in rural locations
Campaigners fear it will devastate smaller towns and villages where banks have closed down and stores or pubs offer the only way to withdraw cash.
James Lowman, of the Association of Convenience Stores, said: ‘Cash machines shouldn’t be taxed – they provide an important service not just for the shopkeepers but for customers as well.
Retailers are being punished for offering a free service and it’s wrong.’
The Valuation Office Agency (VOA), a Government-run organisation which sets business rates, is behind the proposal to tax indoor machines separately.
If it succeeds, it would mean stores would face two lots of business rates – one for an ATM and another for the retail space surrounding it.
The VOA is appealing against an early court ruling which went against it. The hearing is expected in spring. The rates would either be paid by the ATM’s operator, such as Cardtronics or Paypoint, or the small business which hosts it.
Ron Delnevo, of the ATM Industry Association, which represents independent operators, said: ‘This would be a real nail in the coffin for ATMs. Whoever pays the rates, it will be uneconomic. This is happening because local authorities are running round desperate for cash.’
Ron Delnevo, of the ATM Industry Association, which represents independent operators, said: ‘This would be a real nail in the coffin for ATMs’
Small businesses and vulnerable people who are unable to travel far have been clobbered by a wave of branch closures, with the big banks shutting around 1,000 this year alone. In another threat, the Link network, which oversees the country’s 70,000 free cash machines, is plotting cuts to the fees that banks pay when one of their customers withdraws money from an independent’s ATM.
Mike Cherry of the Federation of Small Businesses said: ‘The VOA appears to be attempting another tax grab. Cash is still king for many local economies, particularly those in tourist hotspots and rural areas.’
A VOA spokesman said: ‘Our duty is to maintain accurate rating lists, and this includes consistent treatment of ATMs. We treat all businesses equally.’