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* Sainsbury's to pay 440 mln stg in business rates
* Asda to pay 340 mln stg
* Aldi to pay 100 mln stg
* Market leader Tesco was first to say will pay tax
* Tesco CEO says move not calculated to damage competition
(Adds B&M comment)
By James Davey
LONDON, Dec 3 (Reuters) - Sainsbury's, Asda, Aldi and B&M
will forgo UK property tax relief during the pandemic, following
rivals Tesco and Morrisons and taking the total
recouped by the government from retailers to 1.8 billion pounds
($2.4 billion).
Britain's supermarket groups have seen sales soar during the
pandemic, but have been criticised by lawmakers and media for
paying shareholder dividends while receiving tax relief.
Sainsbury's said on Thursday it would now pay 440
million pounds of so-called business rates, while Walmart
owned Asda will pay 340 million pounds and German-owned
Aldi will pay 100 million pounds.
Discounter B&M later said it would forego business
rates relief worth around 80 million pounds in its current
financial year.
The British government and devolved administrations in March
exempted all retailers from paying the tax on their stores for
the 2020/21 financial year to help them through the crisis.
However, on Wednesday, market leader Tesco said it would
repay the 585 million pounds it had claimed because some of the
risks of the crisis were now behind it, and returning the money
was "the right thing to do".
That stance put pressure on rivals to do the same.
Morrisons had followed, saying it would pay 274 million
pounds.
Sainsbury's said it had performed ahead of expectations,
particularly since the start of the second national lockdown in
England last month.
"With regional restrictions likely to remain in place for
some time, we believe it is now fair and right to forgo the
business rates relief," CEO Simon Roberts said.
Asda CEO Roger Burnley said the group recognised there were
other industries for whom the effects of COVID-19 would be much
more long lasting.
PEER PRESSURE
Tesco CEO Ken Murphy denied its decision to pay was a
calculated one to damage competitors who do not share its
financial strength.
"When we made the decision, we didn't really think about the
competition at all," he told Sky News.
Murphy also said the move was unconnected to Tesco's plan to
pay shareholders a 5 billion pound special dividend when the
sale of its Asian business was completed.
The Co-operative Group said it plans to review its
position at year-end, while discounter Lidl declined to comment.
M&S and Waitrose owner, the John Lewis Partnership
, have said they will not forgo it. Both groups sell a
broader range of products including clothing and homewares.
A spokesman for British Prime Minister Boris Johnson told
reporters the government welcomed any decision to repay support
"where it is no longer needed".
Taking account of the business rates it will now pay,
Sainsbury's forecast underlying pretax profit of at least 270
million pounds ($363.99 million) in its 2020-21 year, and over
586 million pounds in 2021-22.
It will prioritise dividend payments to shareholders over
cutting debt in 2020-21, which will push back its timetable for
debt reduction.
($1 = 0.7409 pounds)
($1 = 0.7418 pounds)
(Reporting by James Davey; additional reporting by Liz Piper;
Editing by John Stonestreet/Mark Potter/Susan Fenton/Jane
Merriman)
