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Written Statement - Proposals for discretionary powers to increase Council Tax on second homes

Carl Sargeant, Minister for Housing and Regeneration

Today I am publishing a summary of responses to the consultation which the Welsh Government has conducted regarding council tax and second homes.  The summary is available at:
http://wales.gov.uk/consultations/localgovernment/council-tax-second-homes/?status=closed&lang=en

The consultation attracted a considerable number of responses and demonstrated a wide range of opinion on the matter.  Almost 200 responses were received.

Following consideration of the matter and the impact which second homes may have on the supply of housing at a time when so many individuals and families struggle to attain a home of their own, the Welsh Government has tabled an amendment to the Bill to provide Local Authorities with a discretionary power to charge a higher rate of Council Tax on second homes.

Whilst second homes can have benefits for the local economy and tourism, the fact they are occupied for part of the year only may have an adverse effect on providers of local services and the availability of affordable housing for local people.  In areas where there is a high concentration of second homes, Local Authorities may consider it necessary for  people who have more than one home to pay a Council Tax premium and thus make an extra contribution to the provision of local services and affordable housing though the local taxation system.  

The Welsh Government does not object to people owning more than one home.  However, we must have regard to the needs of local people who are unable to access an affordable home for themselves and their families.  

The range of opinions which were expressed in the responses to the consultation has prompted the Welsh Government to consider the most appropriate approach in these circumstances.  The proposals therefore aim to give discretionary powers to Local Authorities.  This will mean each Council can consider the effects which second homes are having on their communities and decide whether they (Local Authorities) wish to implement the policy or not.  The decision which each Council makes will therefore need to be explained and justified to its local Council Taxpayers.