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Second homes face 150% council tax premium

30 Nov 2023 3 minute read
Colourful houses in Tenby

Bruce Sinclair Local Democracy Reporter

A call for council tax premiums on second homes to rise to at least 150% in cash-strapped Pembrokeshire is expected to be backed by senior councillors.

New local tax rules introduced by Welsh Government earlier this year saw local authorities being able to set and collect council tax premiums on second homes and long-term empty properties at up to 300 per cent.

Up to 60% second homes in some areas

Pembrokeshire is currently operating a 100 per cent council tax premium for second homes, having previously introduced a 50 per cent council tax premium in 2017.

A premium for long term empty properties in the county was introduced in 2019 for properties that have been empty for three years or more.

Information published earlier this year by Pembrokeshire Coast National Park showed that in some parts of the county more than 60 per cent of homes were second homes.

A public consultation on any potential premium changes, ranging from 0 to 300 per cent,  was launched by Pembrokeshire County Council earlier this year.

Members of the county council’s Cabinet, meeting on 4 December, are recommended to back an increase in the second homes tax premium to 150 per cent, or greater, and an increase for empty properties to 50 per cent for two years and 150 per cent for three years, or greater.

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

A report for Cabinet members says 1,650 responses were received in the recent consultation, nearly three-quarters (74 per cent) from non-residents, with those having second homes or holiday lets not wanting to see premiums raised, preferring no or low premiums.

General council tax rises planned

Of those respondents that did not have a second/holiday home or empty property, 36 per cent wanted a reduction, 21 per cent favoured no change, and 38 per cent favoured an increase.

The report raises comments by the council’s Director of Resources Jon Haswell, who includes budget modelling based on the council’s projected funding gap for 2024-25 of £26.3m.

The report relates to the level of the council tax premiums only, with the outline draft county council budget for 2024-25 also being considered by Cabinet on December 4, which may impact on the figures in this report.

Mr Haswell’s report indicates a potential need for a 15 per cent general council tax increase if the premiums were increased, along with the use of reserves and general services cost savings of £9.8m.

His comments say, if the premiums are not increased, general council tax will increase “way in excess” of 15 per cent, with some council services cut “beyond statutory minimum service levels,” with the use of reserves “a sticking plaster leaving an even bigger projected funding gap to bridge in 2025-26 and beyond”.

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Cwm Rhondda
Cwm Rhondda
6 months ago

The issue of second homes is complex and multi-faceted. In my opinion the main issue is a lack of well-paid jobs in communities with a comparatively high percentage of second home ownership. Merely increasing council tax on second home owners isn’t going to increase affordability of housing to a level where someone on a low wage will be able to afford certain types of housing – this is the economic reality of the situation. Some local authorities are encouraging the building of affordable homes for local community members – this is the way forward (along with policies to create better… Read more »

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