Tourism chiefs call for rethink of new rules for self-catering holiday accommodation
Tourism leaders in Wales are calling for a rethink of new measures which are being introduced to determine if self-catering holiday accommodation operators qualify for business rate relief.
Under the proposals from the Welsh Government the number of days a self-catering business must be open will increase to 252 days a year (an 80% increase.) and the property must then be let out for 182 days an increase of 150%.
At present to be classed as a business in Wales, self-catering operators have to be open for holiday bookings for 140 days a year, and their properties must be let for 70 days a year.
Wales Tourism Alliance (WTA) researchers found that when asked only 16% of self-catering operators thought they could work within this 182-day threshold.
According to the WTA many Welsh operators indicated these new letting day requirements are simply “unattainable,” but if operators fail to meet these new proposals they will no longer qualify for business rate relief and will have to pay council tax instead.
In parallel with the rate relief changes, from next year councils in Wales will be given the power to charge up to an extra 300% council tax on self-catering businesses that fail to get their properties let for 182 days.
There are approximately 8000 self-catering properties in Wales, generating approximately £134 million every year for the Welsh economy and sustaining approximately 4700 jobs.
Rural economy
Self-catering accommodation has become increasingly significant for the rural economy in recent years, with 14% of the 34.000 Welsh farms now having some form of tourism element, mainly self-catering.
Ashford Price, secretary of the Welsh Association of Visitor Attractions and Chairman of the National Showcaves Centre for Wales said: “Like the tourism tax the Welsh Government have not carried out any form of economic impact assessments on these proposed new rate measures.
“If self-catering businesses fail to meet the new letting days requirements these higher council rates will simply make their operational costs so high as to make their business model unviable and they will then have no option but to close down their business and make staff redundant.
“When these rate changes come about Wales will not be able to compete with similar self-catering operations in England/Scotland as the only way they could fund the increase in their rates bill would be to put prices up at a time when families are facing the biggest cost of living crisis since the 1950’s, with many families looking for competitive prices in order to have a holiday at all.
“Many genuine tourism operators feel that with the proposed tourism tax and self-catering rate changes the Welsh tourism industry is at a crossroads and the Welsh Government needs to decide if they want a vibrant tourist industry for Wales.
“Finally, if the Welsh Government goes ahead with the new requirement of 182 letting days to qualify for business rates Wales will lose a massive number of self-catering operators, many tourism jobs will disappear, and the local economy will suffer as there will be fewer visitors to buy their goods.
“The Welsh Government need to rethink their proposals urgently before inflicting serious economic damage on one of Wales success stories- self-catering.”
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Excuse me, would you mind passing me that teeny, tiny violin?
If operators have such a poor business model that they can’t let a property for 26 weeks out of 52 then maybe they should return the property to residential lettings thereby increasing the benefit to the communities by having year round residency rather than the current 10 week minimum.
If owners haven’t managed to let properties for a significant part of the year, then claims we’ve been hearing they greatly contribute to the tourist economy can’t also be true?
The proposed policy won’t prevent owners from operating lets, its a tax avoidance policy. Something we’re always griping the UK Gov do little about. If you can afford a 2nd home and you choose to run it as a token holiday let, then you can afford to pay the rates.
Glad this loophole is being closed fake businesses need to be weeded out
It’s not a loophole the local council still gets the council tax plus an extra £250 from the uk government so they actually make more money also there’s nothing to do in winter so most properties are only booked for weekends from October to march thats why it’s so difficult to reach 182 days camp sites are only open from march till October but they get business rates why not self catering Cotteges which bring in more money
It’s not a “loophole” and they aren’t fake businesses. If you want to ensure they are genuine self catering holiday accommodation businesses rather than second homes masquerading as such, why not just require them to be available for guests for a minimum of, say, 320 days a year, allowing some time for maintenance. That would be a condition that owners should be able to meet and I think you’ll find most are actually available for longer anyway.
Holiday chalets are only available for 10 months of the year, they are not allowed to be used for private rental and yet they are still expected to meet the same occupancy rates as 12 month of the year properties. If these can’t operate as holiday lets they will not be returned to the rental market, they will just remain empty and people who have purchased them to create a small business opportunity for themselves will be out of pocket.. This can’t be right, and doesn’t solve any problems this proposal is trying to fix. The legislation proposed is a… Read more »