The Booksellers Association has claimed that the tax and business rate concessions given to charity shops enable them to unfairly undercut the prices that bookshops are trying to charge and have called for these to be scrapped in the current tough economic climate.

Charities enjoy exemption from corporation tax and VAT on the sale of donated goods, as well as an 80% concession on business rates. It is estimated that around 8,000 charity shops sell books and that there are around 250 specialist charity bookshops. In 2010 Oxfam made £20 million from sales of 12 million books, or £1.66 per book.

The book trade once enjoyed a lucrative arrangement of retail price fixing known as the Net Book Agreement (NBA) which was agreed by publishers in 1960 and disallowed the selling of new books below the price set by the publisher. This ran until 1997 when a Restrictive Practices court deemed it against the public interest and illegal.

As well as competition from charity shops bookshops now face internet retailing and ebooks. And charity shops face competition for second hand books from libraries, currently selling unwanted and donated paperbacks for around 20p.