Landlords In Firing Line For £300m Tory Tax Raid.

PUBLISHED: 5th Mar 2024

Jeremy Hunt is gearing up to unveil his second spring budget as chancellor, potentially marking a significant fiscal juncture ahead of an imminent general election. With a stated intention to implement tax reductions in a prudent manner, Hunt’s approach notably excludes second homeowners profiting from short-term rentals.

Over the past fourteen years, Tory economic policies have posed challenges for the buy-to-let market, marked by a series of tax and regulatory adjustments. However, a recent report in the Sunday Times suggests that the upcoming Budget will introduce a £300 million tax initiative targeting the rental sector, purportedly leaked from government sources.

According to the Sunday Times, Chancellor Hunt plans to eliminate various tax incentives for landlords renting out properties for short-term holiday stays rather than long-term tenancies. Despite being perceived as another fiscal imposition by the Conservatives, Hunt argues that this move aims to alleviate housing shortages in coastal regions and popular vacation destinations like Cornwall and the Lake District, where landlords are increasingly converting properties to holiday lets to capitalize on tax advantages, thereby reducing housing availability for local residents.

Propertymark, a leading industry body, has voiced serious concerns about the potential ramifications of this tax intervention on the rental sector. CEO Nathan Emerson highlighted the precarious situation faced by many landlords, emphasizing the need for government recognition that a functional housing system necessitates sustainable conditions for both short-term and long-term rental providers.

Similarly, a spokesperson reiterated Propertymark’s apprehension regarding the rumored tax adjustments, emphasizing the adverse effects on landlords’ viability and the overall housing system’s stability. The relentless targeting of landlords, particularly amidst economic uncertainties like inflation and rising interest rates, underscores the imperative for policymakers to adopt measures conducive to a resilient and equitable housing market.

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