Play.com - an online retailer - which is based in Jersey will shut its doors in March leaving 147 staff without jobs. The e-tailer blames the removal of the tax loophole of LVCR by the UK government. It had allowed companies in the Channel Islands to transport goods to the UK and Europe tax free if they were under £18. This was later reduced to £15, before being scrapped altogether.
The 147 staff will be made redundant at the end of March. Play.com was sold to Japanese company Rakuten for just £25m in September 2011 and has since seen its dominant online business dwindle. It would appear that in the current economic climate, nobody is safe, with online retailers such as Play suffering the same fate as High Street rivals.
Play.com have released this statement:
"Following strategic review of out business operation, we have announced a company restructure. Moving forward we are intending to focus exclusively on our successful Marketplace, which is our main business area, and to phase out the direct retail part of our business. The removal of LVCR implemented in April 2012 has been a determining factor in this decision."
Play.com has cited the closure of the Low Value Consignment Relief loophole in April last year as ultimately leading to the demise of the firm's retail business. In September the States of Jersey said about 400 people had lost their jobs elsewhere in the island because of the end of LVCR.