HEALTHSPAN chief executive Derek Coates, pictured, has hit back at comments made in the House of Commons about the effect a VAT concession which favours mail order companies in the Channel Islands is having on independent businesses.

He said Labour MP Janet Dean’s claim that small shops were closing had little to do with the de minimus rule.

‘The growth of internet shopping has caused a seismic shift away from bricks and mortar retailers who have to carry heavy establishment and staff overhead costs.

‘Customers are rapidly switching to direct internet suppliers from many, many locations, of which the Channel Islands are but one,’ he said.

Mr Coates said 97% of purchased single CDs were made from online suppliers and this trend would continue at an increasing rate.

Mrs Dean said that the rule, which allows items under the value of £18 to be exported VAT-free, generated £100m. a year in the Channel Islands.

Unfair and illegal competition was, she claimed, also forcing independent health food shops to close. She said Healthspan accounted for 4.9% of total UK sales in vitamins and dietary supplements.