Three shops in the Arnold’s grocery store chain were closed amid increased operating costs including tax hikes, the company’s owner said yesterday.

Frank Arnold “regretfully” shuttered two locations in Somerset and his Arnold’s Express on Front Street.

He told The Royal Gazette last night: “This is a business decision that has been a long time in the coming.”

A notice to customers explained that Arnold’s Supermarket and Arnold’s Liquors, both on Main Road, Somerset, as well as the Front Street shop, were closed as of last Friday.

Mr Arnold wrote: “Regretfully, I have made the decision to close these three locations due to many factors, along with increased operating costs of running these businesses.

“All staff members have been transferred to our three other locations.

“There are no job losses due to these closures.”

He added: “I would like to thank all our valued customers for your business over the many years at these locations.”

Mr Arnold told the Gazette: “I grew up in that Somerset store, I know all the customers in the Somerset area and I grew up with all of them.

“It’s a very sad day for me.”

He said about ten full and part-time staff were relocated from the affected shops.

The three other stores are the Maxi Mart at Hog Bay Level, in Sandys, Arnold’s Family Market on St John’s Road in Pembroke, and Arnold’s Discount Warehouse on Ewing Street in Hamilton.

Mr Arnold explained that the cost of doing business had escalated and cited electricity rates, rents and taxes among the factors.

He said: “Payroll tax alone — payroll tax has doubled in the past year, it’s unsustainable.”

And he added: “The bottom line is we have never been taxed more in our lives.”

Mr Arnold feared the island would see further closures.

He said: “I definitely anticipate there will be more in the coming months, the cost of doing business is too high.”

Operating costs were also partly blamed for the closure of stationery and gift store Pulp & Circumstance earlier this month.

Michael Grayston, the owner of the Washington Lane shop, said several factors — including immigration policy — had contributed to the store’s demise.

He added that “increased taxes on the private sector, exorbitant duty and high payroll costs and overheads have made the traditional bricks and mortar small-business retail model unprofitable”.