Investor Theo Paphitis warns over shrinking high streets and outdated taxes

The businessman said the collapse of groups like Wilko is leaving fewer surviving shops on the high street.

Theo Paphitis has warned over the shrinking number of shops on the UK’s high streets (Theo Paphitis Retail Group/PA)

Retail boss and former Dragons’ Den investor Theo Paphitis has warned over the shrinking number of shops on the UK’s high streets as he said communities are being “devastated” by outdated taxes.

The businessman, who owns chains Ryman Stationary, Robert Dyas and Boux Avenue, said the collapse of groups like Wilko are leaving fewer surviving shops on the high street.

Mr Paphitis told the PA news agency: “The burden is falling on those businesses that have managed to survive.

“Many haven’t. We saw the demise of Woolworths, British Home Stores, Debenhams, House of Fraser, Arcadia, and recently, Wilko. It’s very, very difficult.

It is communities that have been devastated by a ridiculous taxation from the 1500s

Theo Paphitis

“Every time a big player goes out the market, the remaining ones get some of that business – a proportion shared out among themselves. So they survive for a bit longer.

“As the burden increases, it’s self-fulling and then the next one’s done, and a smaller amount remains.”

Mr Paphitis criticised the business rates – a tax on all domestic properties including shops, offices, pubs and factories – which he said the Government has failed to properly reform.

He argued it unfairly hits bricks and mortar businesses, while online and technology giants only face the tax on their warehouses.

He told PA: “It’s another ridiculous tax which is unfair – it damages investment, damages business, and damages our communities.

“It is communities that have been devastated by a ridiculous taxation from the 1500s.”

The remarks come amid a number of big takeovers from high street retailers.

Since the pandemic, fashion and homeware giant Next has snapped up several struggling businesses including furniture brand Made.com, which fell into administration, Cath Kidston, and Joules.

Earlier this month, it revealed it was buying clothing brand FatFace for £115 million, although it said it will continue to be run by its own management.

For Wilko, a raft of its assets were sold off after it collapsed.

The owner of budget chain The Range bought its website and intellectual property, while Poundland acquired a number of stores and has already reopened some under its brand.