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HomeProperty InsuranceHoliday Homes InsuranceSecond Home News Update - Tax

Second Home News Update - Tax

Second Home News Update - Tax

Owners of holiday homes are bracing themselves for the possible imposition of some very unwelcome tax increases. Both holiday home and second home owners may be targeted by the government who are considering imposing steep council tax increases on properties used as second homes or for holiday letting purposes. These new proposals come at a time when the economy is still in recession and the market for selling properties is still considered by many to be stagnant.

It is reported that Communities secretary John Denham is considering the proposal of council tax increases, after it was suggested during a formal consultation The amount under consideration could be up to 50% higher than normal council tax charges. The proposal to him was made by the Local Government Association (LGA). Local authorities where asked for their opinions on the level of taxation imposed on these property types and at least authorities reported back that they would like to see further increases in taxation for this sector. This is bad news in deed for holiday property owners as there have already been increases in council taxes charged by Labour. Up until 2004 holiday home owners received a healthy 50% reduction in council taxes on second homes. This was considered fair as it was thought that the properties where not using so many services as properties that were occupied on a full time basis. However, if there is a change of government and it is looking increasingly likely, there will be a general election in May 2010; the increases may not be agreed. The conservatives take a different view to Labour, calling the plans a penalty surcharge on the owners of holiday property. They also feel that the plan may be difficult to implement as the suggested tapering charge will involve manpower to establish if a property is occupied or not.

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