UK Chancellor May Raise £12 bn by Making Big Online Marketplaces Collect VAT

John Healey is expected to announce that large online marketplaces such as Amazon, eBay and Temu will be required to collect and remit VAT on sales made by third‑party retailers on their platforms. The Treasury estimates that this change could recover about £12 bn a year in VAT revenue that is currently lost. The measure would help restore the government’s fiscal buffer, which has fallen from roughly £24 bn to as low as £11 bn in the last six months, while avoiding increases to income tax, VAT on consumers or National Insurance. The proposal is part of a broader set of options being considered to meet the budgetary headroom needed to reduce borrowing and support spending on defence and cost‑of‑living measures.