Cumbrian MP calls for England to follow Wales and allow councils to raise taxes on second homes
A Cumbrian MP has called for England to follow Wales’ example and allow councils to raise taxes on second homes.
Former Liberal Democrat leader Tim Farron pointed to the housing crisis in Cumbria and Cornwall, saying that the number of second homes was in fact damaging the economies in those areas.
In Wales, local authorities will be able to set council tax premiums on second homes and long-term empty properties to 300% from April 2023.
The criteria for self-catering accommodation being liable for business rates instead of council tax will also change at the same time, from 70 to 182 days.
Speaking in the House of Commons, Tim Farron said: “Cumbria Tourism carried out a survey of members a few months ago and discovered that last year 63% of Lake District hospitality businesses worked below capacity, despite demand being there.
“Why was that? Because they did not have the staff to meet that demand.
“What can we do? Change planning law to make first homes, second homes and holiday lets separate categories of planning use, so that planning authorities and councils can enforce affordability and availability, and ensure there is a limit on the number of second homes and holiday lets in a community.
“We could allow, as the Welsh Senedd has decided, local authorities to increase council tax above 100% on second homes. Councils would have the choice to do that; they would not have to.
“As the hon. Member for St Ives (Derek Thomas) mentioned, quite rightly, we should ensure that council tax is paid on every property that is built as a residence.”
He added: “The simple fact is that a wealthy person, with a second home on the Lizard peninsula or in the Lake District, is subsidised by somebody on the breadline and going to the food bank in the same community because they have let their second home for 70 days a year.
“That means they pay no council tax and, as a small business, pay no business rate. That is an outrage from the Exchequer’s point of view.
“It is also morally outrageous, that people barely getting by are subsidising wealthy people who can afford two, three, four or more homes.”
The Senedd debated the issue of second homes yesterday, with the Welsh Conservatives saying that the Welsh Government’s action was a “blunt instrument that’ll end up as a hammer blow to the tourism sector instead”.
“And the key reason for that is the Welsh Government has either been unable or unwilling to make a distinction between second homes and self-catering holiday lets,” Senedd Member Tom Giffard said.
“This means that many normal people across Wales who let out flats, houses and cottages to visitors will be completely unable to meet the new threshold and it will price them out completely of ever being able to afford to offer visitor accommodation to people across Wales and internationally.
“And that isn’t a political argument; that’s something that’ll impact real tourism operators here in Wales.”
But Welsh Government Finance Minister Rebecca Evans said that the aim was to ensure that second home owners “make a fair contribution to the communities in which they have homes or run businesses”.
“This in turn is part of our three-pronged approach to addressing the impact that large numbers of second homes and holiday lets can have on communities and the Welsh language,” she said.
“The views conveyed in the consultation, including from the wider tourism sector, clearly support a change to the criteria for self-catering accommodation to be classified as non-domestic.
“Responses indicated that genuine holiday accommodation businesses would be able to satisfy increased letting thresholds and a wide variety of possible alternatives were suggested.
“Increasing the thresholds will provide a clearer demonstration that the properties concerned are being let regularly and are making a substantial contribution to the local economy.”
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