Green Tax to hit landlords
Thursday 11 August 2016
Landlords who let out Victorian and Edwardian homes are more likely to be hit by a new ‘green tax’ of up to £5,000 to make their properties more energy efficient.
The Telegraph reports that as many as 330,000 buy-to-let-landlords will have to pay upfront for improvements like insulation, cavity wall filling and new boilers from 2018.
A plan allowing landlords to get Green Deal loans to pay for the changes, which would be repaid by tenants who benefit from lower bills, has been scrapped by the new Department for Business, Energy and Industrial Strategy (BEIS) who have ruled homeowners should stump up first.
Victorian and Edwardian properties are typically less energy efficient compared to homes built over the past decade or so and will consequently cost their owners the most.
Energy efficiency measures do not come cheap: gas central heating can cost £3,900 and cavity wall insulation can set you back as much as £500.
However, the Department of BEIS believes that because 60 per cent of buy-to-let properties are currently owned outright, landlords can simply use their equity to borrow more to cover the costs.
It also claims rents will only be minimally impacted as relatively few homes will be affected.
The move has stoked fears that the buy-to-let industry is being used as a ‘cash cow’ by the Government.
Philip Hammond, the new Chancellor, has signalled he would not scrap the controversial 3 per cent stamp duty surcharge and cuts to tax relief on mortgage payment imposed by his predecessor, George Osborne.
Richard Jones, policy adviser at the Residential Landlords Association, said: "Landlords have been harshly treated. This is an extra stealth tax on top of all the other measures that threaten the finances of the sector.”
Green campaigners say landlords have received subsidies in the past to carry out improvements – but this is of scant comfort to those who were, and are, unable to take the opportunities.
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