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Sancho Panza

Empty Home Owners Face Ghost-Town Tax

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Telegraph 19/8/13

' Residents say some wealthy investors have bought four or five homes in affluent areas of London, driving up prices and damaging the sense of community because most of the properties are left empty. They fear the number of unoccupied homes could see schools and independent businesses forced to close in 20 years.

Camden council, a Labour-run authority in north London, which covers Primrose Hill, wants to charge owners of homes that have been empty for more than two years double the normal council tax in a bid to return vacant properties to use. '

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Telegraph 19/8/13

' Residents say some wealthy investors have bought four or five homes in affluent areas of London, driving up prices and damaging the sense of community because most of the properties are left empty. They fear the number of unoccupied homes could see schools and independent businesses forced to close in 20 years.

Camden council, a Labour-run authority in north London, which covers Primrose Hill, wants to charge owners of homes that have been empty for more than two years double the normal council tax in a bid to return vacant properties to use. '

Priced out of Padstow

I always smile when it reaches the chattering classes in their home territory - now we must do something about it.

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Camden council, a Labour-run authority in north London, which covers Primrose Hill, wants to charge owners of homes that have been empty for more than two years double the normal council tax in a bid to return vacant properties to use. '

Do they think someone rich enough to leave a house in Primrose Hill empty will be bothered by double council tax? These are investments in capital appreciation. The only solution is some form of tax on property capital gains.

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Nope. But it does increase council tax receipts with relatively little opposition.

And just as importantly - IMO - it plants the "empty property is bad" meme in the population.

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http://www.citizensinformation.ie/en/money_and_tax/tax/capital_taxes/capital_gains_tax.html

They have capital gains for second properties here in Ireland. You also have to pay tax on rental income, and that's before expenses. Tax on Primary residence is excluded.

Capital gains exempt from Capital Gains Tax

Gains or profit on the disposal of some assets are specifically exempted from Capital Gains Tax, these include:

Gains on the disposal of property owned by you (house or apartment) which was occupied by you or by a dependent relative as a sole or main residence. Restrictions may apply where the property was not fully occupied as a main residence throughout the period of ownership or where the sale price reflects development value.

The UK's position with no capital gains on second property is unusual, but we all know why that is (MP's expenses)

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Do they think someone rich enough to leave a house in Primrose Hill empty will be bothered by double council tax? These are investments in capital appreciation. The only solution is some form of tax on property capital gains.

As well as the security they post on the empty properties. Should it be a separate 'non-occupation' tax?

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The UK's position with no capital gains on second property is unusual, but we all know why that is (MP's expenses)

Last time I looked CGT was payable on any land or property not classes as your "main home".

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Last time I looked CGT was payable on any land or property not classes as your "main home".

Yup. Our situation is the same as the Irish one described above; income tax on rent and CGT on anything that's not your primary residence.

EDIT TO ADD: when I say "anything", that's exactly what it means - be it a holiday home or a stash of Bitcoin. Except gold sovereigns - which are CGT exempt.

Edited by justthisbloke

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Do they think someone rich enough to leave a house in Primrose Hill empty will be bothered by double council tax? These are investments in capital appreciation. The only solution is some form of tax on property capital gains.

...they will pay someone a nominal amount to look after it for them...... a house sitting job. ;)

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Telegraph 19/8/13

' Residents say some wealthy investors have bought four or five homes in affluent areas of London, driving up prices and damaging the sense of community because most of the properties are left empty. They fear the number of unoccupied homes could see schools and independent businesses forced to close in 20 years.

Camden council, a Labour-run authority in north London, which covers Primrose Hill, wants to charge owners of homes that have been empty for more than two years double the normal council tax in a bid to return vacant properties to use. '

A Land Value Tax would deter wasteful underuse of property.

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Do they think someone rich enough to leave a house in Primrose Hill empty will be bothered by double council tax? These are investments in capital appreciation. The only solution is some form of tax on property capital gains.

They pay that too, but only if they actually realise a gain.

The tax you want is on land value. Payable every year, and at a rate more like what less property-obsessed countries[1] charge.

When my colleague tells me he pays $5k/year tax on his $170k house, I can see both why his house is so much cheaper than it would be here, and why he pays less tax on his hard-earned.

[1] Or states, in federal systems like the US.

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...they will pay someone a nominal amount to look after it for them...... a house sitting job. ;)

Usually the house sitter pays a nominal amount. Anyway if this proposal achieves that then job done - the property is now being used as a home albeit on a very short notice basis.

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