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100% second home tax premium expected with further increase to follow

01 Dec 2023 3 minute read
Llangrannog. Photo rikdom is licensed under CC BY-NC-SA 2.0.

Bruce Sinclair Local Democracy Reporter

Senior Ceredigion councillors are being asked to back a rise in the county’s second homes tax premiums to 100% with a further increase to follow.

Ceredigion currently has a 25 per cent premium on both second homes and empty properties, while neighbouring authority Pembrokeshire currently has a 100 per cent premium for second homes.

New Welsh Government local tax rules now allow local authorities being to collect council tax premiums on second homes and long-term empty properties at up to 300 per cent.

Increase recommended

Ceredigion, and neighbouring Pembrokeshire recently held public consultations on potential changes to second home and empty property council tax premiums, with senior Pembrokeshire councillors next week being asked to back a recommendation of ‘at least’ a 150 per cent premium in the case of second homes.

Members of Ceredigion County Council’s Cabinet, meeting on December 5, are recommended to back an increase in the premium on second homes in two tranches: to 100 per cent, effective from April 1 of next year, and to 150 per cent from April 1, 2025.

Members are also recommended to back increases in the empty properties tax premium, from the current 25 per cent, to 100 per cent for properties empty for up to five year, 150 per cent for five-ten years, and 200 per cent for over ten years.

Any Cabinet backing would take the form of a recommendation to the full council meeting of December 14, where a final decision would be made.

Stark difference in consultation responses

A report for Ceredigion Cabinet members says the recent public consultation saw 1,403 responses, the majority (72 per cent) of those not owning a long-term empty property thought it was appropriate to increase the premium; with a majority (85 per cent) of those owning such a property against an increase.

On second homes, just over half of respondents who did not own one thought an increase was appropriate, favouring an increase to 100 per cent, or even 150, with 94 per cent of second home-owners not wanting an increase.

“Clearly long-term empty property and second home owners did not generally support an increase in the council tax premium, but in both cases a majority of non-owners did,” the report says.

It concludes: “Addressing the issues of second homes, holiday homes ownership and the conversion of residential properties to holiday lets is a key priority within the council’s approved 2022-2027 Corporate Strategy.This and increasing the supply and range of options for affordable housing in Ceredigion forms a key part of the Corporate Wellbeing Objective – ‘Creating Sustainable, Green and Wellconnected Communities’.

Areas with the highest proportion of second homes in the county are mostly coastal, the highest being New Quay, with a 27.2 per cent rate, followed by Llangrannog 17.1, Borth 14.1, Pontarfynach 11, Penbryn 9.6, Aberaeron 9.1, and Aberporth 8.4.

Long-term empty properties were greatest in more urban areas: Aberporth 2.2 per cent, Aberystwyth 1.8, Cardigan 1.5, and Llandysul 1.5.

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2 months ago

This is merely an opportunity for Ceredigion County Council to raise revenue. Please don’t pretend this is to limit second home ownership.

Cwm Rhondda
Cwm Rhondda
2 months ago
Reply to  Brian

Increasing council tax on second homes is a populist policy, which will have limited impact.

2 months ago
Reply to  Cwm Rhondda

It serves to send out a message to owners of second homes but I accept it does very little if anything to restore the ability of prospective buyers to acquire homes in today’s over inflated market. Houses need to revert to being “homes” rather than “investments” but I fancy that’s a long way off.

2 months ago

What it absolutely will do is result in people spending less in the local shops, restaurants and pubs because the Council are stealing it from local businesses.

It might possibly benefit local communities in the long term. In the short term it will fill Council coffers at the expense of local businesses. The fact that local people think that it will benefit them when it will have the opposite effect is a major con trick and more than a little sad.

2 months ago

Since the 2nd home premium was introduced, it has been shown that over the 6 years it has been in existence in Ceredigion, it is the general council taxpayer who has been subsidising those who claim to be running a holiday let business as opposed to a second home. The criteria for a holiday let business was a base year to establish that the property was available for let for 140 days and actually let for 70 days. This allowed those individuals to claim ‘small business rates relief’ (most allegedly paying nothing or next to nothing as a result towards… Read more »

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