Report urges scrapping Tax Changes for Landlords
Wednesday 10 August 2016
Real reform of supply is needed to tackle the shortage of housing in the UK, a new report says, but first unfair attacks on BTL landlords must be scrapped.
‘Taxing tenants: how taxes on landlords end up hitting tenants’, by Rory Meakin of the Tax Payers’ Alliance (TPA), warns that tenants will bear the brunt of bad legislation and the failure of successive governments to implement meaningful change.
George Osborne’s disastrous attacks on the BTL industry, including a three per cent Stamp Duty surcharge for second home owners and new restrictions on finance cost relief, have only served to disadvantage poorer tenants by driving up rents, it claims.
The TPA is calling for the abolition of Stamp Duty and brands it as ‘an unfair tax’ which, perversely, ‘makes the dream of home ownership ever more distant for millions of families.'
The report finds that the while the surcharge and the restriction on finance cost relief may help prospective buyers in the short term – it is tenants in rented accommodation who will pay the price as costs are passed on.
The TPA’s report slams the moves as ‘regressive measures’ which will distort an already damaged housing market, and traces the effect they will have on incomes, employment and overall welfare.
It recommends cancelling the Stamp Duty surcharge and the restriction on finance cost relief, and cutting all Stamp Duty rates by 50 per cent immediately.
Chief executive Jonathan Isaby has called on the new chancellor to ‘drastically simplify and reduce property taxes.
He blasts Stamp Duty for not raising much revenue in the first place and claims it leads to the ‘misallocation of housing stock, lower incomes and higher unemployment than necessary’.
Land needs to be made available to release pressure from the housing market and the TPA says declassifying some green belt areas and permitting higher, denser construction in cities would ease matters.
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