Tesco has said it will repay the £585 million it saved from the Government’s business rates holiday introduced during the coronavirus pandemic.

The UK’s largest supermarket chain said it would be looking at how it could give back the total sum to the Treasury and the UK’s devolved administrations.

Tesco chairperson John Allan said today: ‘The board has agreed unanimously that we should repay the rates relief we have received.

‘We are financially strong enough to be able to return this to the public, and we are conscious of our responsibilities to society.’

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The FTSE 100 supermarket has used ‘every penny’ of the rates relief offered this year, it said, but added it had remained ‘resilient in the most challenging of circumstances’.

Tesco chief executive Ken Murphy added: ‘Our colleagues have done an exceptional job in responding to the challenges of the pandemic.

‘While business rates relief was a critical support at a time of significant uncertainty, some of the potential risks we faced are now behind us.

‘Every decision we’ve taken through the crisis has been guided by our values and a commitment to playing our part.

‘In that same spirit, giving this money back to the public is absolutely the right thing to do by our customers, colleagues and all of our stakeholders.’

The company added it had spent £725 million making supermarkets safe, hiring new staff and increasing shopping slot capacity – which is more than it saved.

The Government unveiled almost £10 billion of business rates relief in total as part of its economic support package during the Covid-19 crisis.

The rates holiday is due to end in March.

A number of supermarkets have faced scrutiny about benefitting from this, because they are also paying out dividends to shareholders.

The news comes after the UK’s debt soared to £2 trillion last month following huge Government borrowing to keep the economy going.

Chancellor Rishi Sunak said: ‘We’ve provided over £200 billions of support to protect the economy, lives and livelihoods from the significant and far-reaching impacts of coronavirus.

‘This is the responsible thing to do, but it’s also clear that over time it’s right we ensure the public finances are put on a sustainable path.’

He warned the ‘economic emergency has only just begun’ in his Winter Spending Review last week.

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