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Bear Goggles

Radical Labour levy would double council tax on holiday homes

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https://www.theguardian.com/money/2018/sep/23/second-home-tax-labour-policy-double-council-tax-homelessness

Without wishing to get into a conversation about whether this is a good or bad thing, it will be interesting to see whether this is a popular policy.

I shouldn’t think the majority of the population own second homes, so it might be. 

But I think it’s a stretch to imagine the Tories will adopt it (like they have other Labour populist policies) even if it is. 

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44 minutes ago, Trump Invective said:

Money is small beer but every little helps I guess

Half a billion according to the article, apparently to be used to fund homelessness services.

Classic left wing redistributionist policy. The kind of thing that was scoffed at during the Thatcher era for stifling wealth creation and hard work. 

I cant imagine any senior politician making that argument today, no one really believes that story anymore. They’ll have to attack it on the grounds of it being unworkable or that increasing the tax burden on holiday lets is taxing family holidays or something. 

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10 minutes ago, Ah-so said:

Good idea - I works like to see a LVT of 1 or 2 % on all unoccupied homes. 

Good point. 

1 minute ago, Si1 said:

They call it radical but it looks more liberal to me.

Yeah, lots to like for both liberals and socialists. The tories will hate it but it would be a difficult manifesto pledge to criticise during a GE. 

(Also, perdantic nerd-point, but the word “radical” originates from the liberal tradition)

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2 hours ago, Bear Goggles said:

https://www.theguardian.com/money/2018/sep/23/second-home-tax-labour-policy-double-council-tax-homelessness

Without wishing to get into a conversation about whether this is a good or bad thing, it will be interesting to see whether this is a popular policy.

I shouldn’t think the majority of the population own second homes, so it might be. 

But I think it’s a stretch to imagine the Tories will adopt it (like they have other Labour populist policies) even if it is. 

Speaking as someone from a borough where holiday lets are 30%+ of housing - yes.

They are a total fuxing curse.

A mate lives between 2 holiday lets. He had ft neighbours 15 years ago.

It is hell in summer.

All tax advantages need removing from holiday lets. They need to pay busine rates too. And should require planning change of use.

At tge mo they pay no ctax or rates.income can be offset against costs. 

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2 hours ago, BorrowToLeech said:

Hardly radical, is it?

Not at all. In my area there are holiday homes worth £2-300k or more that are only occupied for a handful of weeks a year and the rest of the time they're sat empty, not even used as holiday lets.

 

Double council tax would have no impact at all on the owner's finances.

 

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22 minutes ago, spyguy said:

Speaking as someone from a borough where holiday lets are 30%+ of housing - yes.

They are a total fuxing curse.

A mate lives between 2 holiday lets. He had ft neighbours 15 years ago.

It is hell in summer.

All tax advantages need removing from holiday lets. They need to pay busine rates too. And should require planning change of use.

At tge mo they pay no ctax or rates.income can be offset against costs. 

Interesting, yeah, I’d say this is another part of the backlash against housing as an investment. I mean, for most of us it’s a home, and having your home or neighbourhood treated like a tradable commodity for the benefit of an absentee owner is going to piss people off, especially outside the big cities where Labour needs to win support. 

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14 minutes ago, nome said:

Double council tax would have no impact at all on the owner's finances.

Agreed, its pathetic and would hardly dent many of their owners bank accounts.  It needs to be far more draconian to be effective.   I do despair at how mainstream the Labour Party are at the moment; they need to metaphorically 'put the boot in' or they are going to lose many of their new supporters.

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1 hour ago, frederico said:

News just in ... Labour ain't gonna levy anything 

Probably not.

But force Cons tp up theur taxing of non OO property.

Id much rather parties competed to over tax the under taxed than rise more taxes on earned income.

Lets go for S25!

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4 hours ago, dougless said:

Agreed, its pathetic and would hardly dent many of their owners bank accounts.  It needs to be far more draconian to be effective.   I do despair at how mainstream the Labour Party are at the moment; they need to metaphorically 'put the boot in' or they are going to lose many of their new supporters.

Yeah only half a billion, not really much at all.   I'd vastly more prefer a 1-2% LTV.   But it's the boiling frog thing.   Gotta start somewhere.   Though I'd prefer them to boil sooner rather than later.

 

Edit : It also looks like there's a Lab push to move councils back to a system of rates (which operates very similar to a LVT if I remember correctly?), which has the Tory rentiers foaming at the mouth -

Now if that happens...... 😎

Quote

https://www.telegraph.co.uk/news/2018/09/22/labour-plans-holiday-home-tax-raid-return-council-rates/

Separately, Labour councillors from 36 councils in a coalition led by Paul Dennett, the Labour mayor of Salford, have endorsed plans to replace council tax with domestic rates – the system that existed in England until 1990. Conservative sources claimed it could cause bills to rise by £470 a year on a typical Band D home, based on a similar system in Northern Ireland.

James Brokenshire, the Communities Secretary, said: “Bringing rates back from the dead would be a tax raid on middle England, hitting those who have saved and worked hard to improve their homes. Jeremy Corbyn’s Labour Party has gone back to the 1970s – from a return of the militant Left to bringing back punishing rates of taxation on family homes.”

A Labour spokesman said of Mr Dennett's plan : “This is not Labour policy. The next Labour government will need to rebuild local services but we would never adopt a policy that would leave people worse off than they are under the Conservatives.”

 

 

Edited by Lurkerbelow

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I would prefer a chunky LTV on all properties, with income tax being reduced to offset this.

 

But this is unlikely to happen (the second part definitely won't happen)

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10 hours ago, reddog said:

I would prefer a chunky LTV on all properties, with income tax being reduced to offset this.

 

But this is unlikely to happen (the second part definitely won't happen)

I don't think income tax is the problem in the UK, its all the other taxes we pay.  For the low paid, VAT will be the largest tax they pay.  Add to that fuel duty, insurance tax, council tax etc. etc.  The UK has a raft of what are sometimes referred to as stealth taxes.  Don't forget that one of the first things Thatcher did was to raise tax (VAT).

https://www.bbc.co.uk/news/business-22064354

But Thatcher's chancellors not only cut income tax, but also changed the way we pay tax. To fund lower taxes on incomes, up went tax on most things shoppers bought. VAT, or value added tax, jumped from 8% to 15%.

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Another nice little gimmick I suppose. But dont forget the Tories have just introduced a new law that will allow councils to apply a 300% council tax premium on long term empty homes.

As for this supposed £3000 extra charge - this figure only applies to homes in Band H taking the national average council tax - as second homes already are liable for full council tax.. In practice most second homes will be liable for a far lower charge as outside central London hardly any houses are in Band H. So £3000 is a very misleading figure. In reality its only £1500 - at Band D - as they already are liable for 100% council tax.

In fact a second home in Westminster even in Band H will only be liable to pay £1,421 extra a year given its low council tax - yes a real burden for a property worth several million (as Band H properties in Westminster now cost). Probably a weekend's rent on Air bnb.

Frankly I would make it a 500% charge and more - that actually might have an impact!

https://www.gov.uk/government/news/james-brokenshire-provides-stronger-powers-for-councils-to-tackle-empty-homes

Edited by MARTINX9

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My local council actually offers grants and/or interest free loans for owners of long term empty homes to refurb them.

Just let that sink in,... people who can afford to have one (or more) properties just sat empty are actually being given money to do them up!

Edited by nome

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On 23/09/2018 at 11:56, spyguy said:

Speaking as someone from a borough where holiday lets are 30%+ of housing - yes.

They are a total fuxing curse.

A mate lives between 2 holiday lets. He had ft neighbours 15 years ago.

It is hell in summer.

All tax advantages need removing from holiday lets. They need to pay busine rates too. And should require planning change of use.

At tge mo they pay no ctax or rates.income can be offset against costs. 

If I remember rightly, you know most about the Scarborough area where there are a lot of houses up for sale, and not many being sold. Isn't it better that they are holiday lets, rather than remaining empty?

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35 minutes ago, onlooker said:

If I remember rightly, you know most about the Scarborough area where there are a lot of houses up for sale, and not many being sold. Isn't it better that they are holiday lets, rather than remaining empty?

No because the residents don't spend any money locally. Granted its less a problem in a town than in a Yorkshire Dales or Yorkshire Moors village but locals use the local shops and facilities, holiday lets may occasionally visit the pub in the summer but don't keep it going over the winter...

Separately looking at the Yorkshire Dales farm buildings can be converted into either holiday lets or homes for local occupancy only. The former means that barns worth £50,000 max are going for £250,000 plus and the locals are still priced out...

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