TNT Post is to go to court next month to challenge rival Royal Mail’s tax exemption status as the universal service provider, just as the state-owed post and parcel carrier prepares for its floatation.

TNT Post believes that Royal Mail should not have a 20% advantage over other parcel carriers if it becomes a privately-owed company.

Currently, European law states that companies that provide a universal service, like Royal Mail, can be granted tax exemptions.

A spokeswoman for TNT Post confirmed that the firm is looking to take legal action, with the next court meeting due on 26 November.

“Royal Mail should be open to the pressures of competition and no longer enjoy the government gift of a 20% cost advantage over its competition. A level playing field of competition will allow better services to be developed and new jobs to be created,” the spokeswoman said.

“Royal Mail needs access to capital for its modernisation plans and this is the route it has chosen. However, privatising a monopoly is bad for consumers, bad for business and bad for UK PLC,” she added.

Royal Mail was unavailable for comment.

Topics