The second home tax is punitive, petty and politically motivated

Tax rises are never popular, but I think we have a winner. Second home owners feel that they are being unjustly targeted and treated as cash cows. Understandably, they're not happy.

Daily Telegraph

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Two thirds of local authorities across England have this month brought in a double council tax charge on second homes, piling misery on 280,000 owners who will see their bills rise 77 per cent to £3,672, on average, according to analysis by The Telegraph. In some areas, council tax bills for second homes will surpass £10,000.

I’ve rarely seen a topic enrage readers like this stealth tax on wealth. The Telegraph’s inbox has been inundated with emails of woe from those who feel that they have done nothing wrong but are being financially penalised. Property owners tell us they feel more like residents in their second home area than their hometown, taking great efforts to get to know their neighbours and pumping money into the economy. Yet councils want them gone, ostensibly to free up homes in holiday hotspots for local buyers and to raise funds to tackle housing shortages.

These have already failed to hold up to scrutiny, with holiday “notspots” (really, Bradford?) also capitalising on the chance to raid wallets and councils spending just 9p of every £1 raised on affordable housing.

Worst of all? The Government has admitted it has no idea what effect this policy will have on house prices or the number of second homes. This sorry state of affairs appears to be a politically-motivated crackdown on perceived wealth – and it may well backfire.

In 2013, the Government attempted a similar attack on empty homes, giving local authorities powers to increase council taxes by 50 per cent, with quadruple bills for properties unfilled for over a decade. I dug into the numbers and discovered that the situation is worse now than it was before, with the number of empty homes at a 14-year high.

Could a similar fate befall second homes? It certainly appears so. My colleague Pieter Snepvangers went to Wales, where the second home council tax surcharge was introduced a year ago, and found that the country had succumbed to a “lose-lose” situation where house prices have plunged but still remain out of the budget of local buyers.

Questions are also swirling about the legality of the crackdown. Homeowners tell us that they were “blindsided” when the tax bill landed on their doormat. They say the policy amounts to “taxation without representation” as second home owners cannot vote in local elections and are being billed twice for council services that they cannot use.

Some savvy owners are already deploying legally sound tactics to swerve the hefty bills. By listing a second home for sale (and marketing it at a reasonable price) you’ll be awarded with a 12-month exemption to the premium from your local council. It’s a neat trick and one where there is no obligation to sell.

But this should be unnecessary, as second home owners shouldn’t be penalised for inheriting a family home or investing their hard-earned money in property instead of stocks. That’s why The Telegraph is calling on the Government to abolish this punitive, petty premium. Have you been affected by double council tax on second homes? Email us at money@telegraph.co.uk.