MPs CALL FOR END TO SECOND HOME TAX BREAKS (Julia Goldsworthy)

Julia Goldsworthy <info@juliagoldsworthy.org>

MPs CALL FOR END TO SECOND HOME TAX BREAKS

February 9, 2010 11:15 AM

Local Liberal Democrat MPs Dan Rogerson and Julia Goldsworthy have met with Local Government Minister Barbara Follett to raise concerns about the impact of the growth of second homes in Cornwall.

They highlighted loopholes that allow many second home owners to benefit from tax breaks, and urged the government to give local councils more powers to tackle the issue in areas where second home ownership is threatening the viability of community life.

Owners of second homes can avoid paying council tax, by claiming the property is 'available to let' for seventy days a year. This classes them as a small business, and leaves them entitled to small business rate relief. By defining their second home in this way, second homeowners can also get out of paying capital gains tax, by claiming 'rollover relief' when they sell the property.

Cornwall's Liberal Democrat MPs have called on the Government to give councils powers to require planning permission to turn full time homes into second homes, in the areas where it is a significant problem. They also successfully campaigned to reverse the Conservative policy of allowing second homeowners to pay half the council tax that full-time residents pay.

Commenting, North Cornwall's MP, Dan Rogerson, said:

"The uncontrolled proliferation of second homes in villages all round Cornwall can mean real problems for local traders, and for village life. With hundreds of homes empty for long periods, it's difficult for local shops and pubs to maintain the year-round trade they need to stay open. Without those businesses, once thriving villages can end up little more than collections of properties.

"Having finally got rid of the Conservative Council Tax discount for second home owners, we cannot now put up with people claiming to be businesses just to avoid paying their fair share.

"There must be clear criteria for being classified as a business and simply having your place notionally available to let for less than a fifth of the year cannot be adequate to meet that test."

Falmouth and Camborne MP, Julia Goldsworthy added:

"The Conservatives gave second homeowners huge tax advantages, which the current government have failed to tackle. People living in Cornwall just want a level playing field, and councils should have the opportunity to take action to tackle second home ownership growth in the areas where it is genuinely posing a threat to community life."

"This means ending the unfair tax breaks, and putting councils in the driving seat. Action must be taken now to stop the rot, which is why I will be presenting a Bill in the House of Commons on this subject."