The leader of Gwynedd Council has called on the Welsh Government to change their guidelines so that owners of second homes do not have access to business support grants of up to £25,000.
There is concern that second home owners who have deliberately converted to business rates to avoid paying taxes can apply for the financial support announced by the government following the development of Covid-19.
Gwynedd Council’s Leader, Plaid Cymru’s Cllr Dyfrig Siencyn, said he had contacted the Minister, Julie James, to highlight the fact that it is unethical that wealthy second home owners who have cynically played the system have access to the public purse to line their own pockets.
In Gwynedd alone it is estimated that between £15m and £18m could be made available to second home owners through the loophole in the financial support package for small businesses from the Welsh Government.
“It is unethical that wealthy individuals who own second homes have access to this financial aid package from the Government,” Dyfrig Siencyn said.
“It goes against the whole ethos of the support aid, a package to ensure a viable economy in an uneconomic period due to this disease outbreak that is spreading through the country.
“This grant should assist small rural businesses in Gwynedd that have been directly affected by Government laws that prevent companies and businesses from trading. That is the reason I have asked Gwynedd Council’s legal department to look at a specific clause within the business guidelines, so that it differentiates between a legitimate rural business and second home owners.”
Leaders of other county councils across Wales are supporting Gwynedd’s calls, including Anglesey, Conwy, Ceredigion, Carmarthenshire and Pembrokeshire county councils, where a high number of second homes exist. Numerous discussions have also taken place within the Welsh Local Government Association in recent days.
“We welcome the response of the Minister, Julie James, within this debate. It has been positive and constructive. But unfortunately, civil servants are dragging their feet with the details,” according to Councillor Dyfrig Siencyn.
The business note guidance Gwynedd has submitted to the Welsh Government states: “In relation to self-catering accommodation, a business will not be eligible for the grant if the property was at any time, since 1st April 2010, a domestic dwelling.
“However, self catering accommodation will be eligible for the grant if the property has a specific planning permission for such use. Evidence of planning permission must be submitted to support the application for the grant if requested by the administering authority.”
Councillor Dyfrig Siencyn said: “By adding this clause to the business guide it would omit those who have let their second home for a period to avoid paying Council Tax, from receiving the grant, but at the at the same time, ensure that those legitimate businesses that have converted a dwelling into a business, receive it.
“We look forward to receiving the formal response of Welsh Local Government Minister, Julie James today. We hope she will offer a crystal clear guidance to the business support, should any county council face a legal challenge, from these wealthy second home owners.”