The government is to launch a significant new initiative which looks set to embrace businesses such as Airbnb, just days after the chair of Abta blasted “the sharing economy”.
As part of its focus on building a nation of entrepreneurs, the Sunday Telegraph reports that the government is expected to launch a major review of the UK’s sharing economy in a bid to boost London’s growing technology sector and encourage entrepreneurism.
Business and enterprise minister Matt Hancock will announce the launch of a study today into the sharing economy and the way UK businesses interacts with it.
It is estimated that 25% of UK adults are sharing in some way online, with global revenues estimated to rise from £9 billion today to £230 billion by 2025.
The move comes just days after Abta chair Noel Josephides closed the Abta Travel Convention with a warning speech about the dangers of the shared economy.
Citing companies such as Airbnb, Josephides said the growth of the sector was damaging Britain’s economy.
“Classified adverts have always been there, and we tolerated it. But what companies like Airbnb have done is use the internet as a platform to allow the black economy to grow and grow.
“The majority of those letting their property don’t declare their income. Can you imagine the economic loss of these people who are not paying taxes?
“Why should legitimate businesses have to be leaden with taxes?” Josephides added.
“The government is sleepwalking towards its own destruction and that of the businesses that provide them with their income.
That the UK government is looking at embracing the shared economy is a stark contrast to its counterparts around the world.
In New York, Airbnb has faced accusations from the hotel lobby of facilitating a grey market in “illegal hotels” that avoid taxes and make it more difficult for locals to find affordable rental property. The company also faced similar opposition in San Francisco, where it was founded.
Speaking to the Sunday Telegraph, Hancock said: “These new business models put money into households the length and breadth of the country. I want to make sure that the UK is front and centre if that, compering with San Francisco to be the home of these young tech start-ups.
