3 days ago
Suspend Tory second homes tax raid, Grant Shapps urges Labour
A senior Conservative has urged Labour to suspend his party's second home council tax premium.
Sir Grant Shapps has called for the double council tax to be paused in 'areas where markets are seizing up and tourism is taking a kicking'.
The former housing minister has also piled pressure on Angela Rayner to conduct an impact assessment and stop making 'decisions in the dark'.
He is the latest politician to back The Telegraph's campaign against the 100pc council tax surcharge on second homes, which came into effect in 230 town halls on April 1.
Kevin Hollinrake, shadow housing minister, said: 'This tax should be used to keep council tax bills down, or to build affordable housing. Labour is doing neither of these.
'There has been a cavalier approach to implementing it, with Labour doing no research on its effect on the housing market and leaving local residents to pick up the tab.
'Labour is using this tax as a club to hammer middle England, and trying to pull the wool over the eyes of hard-working families while they're at it.'
Nigel Farage, Reform UK leader, said: 'Owning property used to be a right and a freedom. Today it is an excuse for the Government to use extortion.'
Mrs Rayner's department has previously refused to investigate the impact of the second home council tax raid on local economies, housing markets or tourism. Instead, the Government said it was up to individual councils to decide whether it was 'effective'.
Despite this, The Telegraph revealed that eight in 10 local authorities with the second home premium failed to carry out impact assessments.
Sir Grant, who served as housing minister between 2010 and 2012, said: 'Labour's cack-handed council tax whack on second homes is walloping ordinary families with four-figure bills while doing absolutely nothing to get roofs over people's heads.
'I spent my time as housing minister cutting red tape and backing aspiration, not penalising it. So here's my three-point common-sense fix: first, commission an independent impact assessment – no more decisions in the dark.
'Second, hit pause on that 100pc premium in areas where markets are seizing up and tourism's taking a kicking. Third, hand power back to councils to target genuinely empty or derelict properties instead of clobbering every granny annexe in sight.
'Do that, and we'll help communities thrive instead of driving them into the ground.'
The second homes premium was introduced in the Levelling Up and Regeneration Act by Michael Gove in 2023 to fix the housing crisis. But it has since been utilised by town halls as a way of boosting depleted coffers.
Since its introduction in 2017, the property market has crashed in areas of Wales. Pembrokeshire suffered an 8.9pc decline in house prices after owners raced to sell up their properties and avoid the tax raid.
Despite pushing prices down, the properties being sold remain out of the budget of locals, Carol Peett, a buying agent at West Wales Property Finders said.
During his tenure as housing minister, Sir Grant overhauled social housing. He abolished the Tenant Services Authority, which was responsible for regulating social landlords. The powers were passed to the Homes and Communities Agency.
In 2012, the Conservative government introduced the affordable rent regime, to give housing associations a way to increase their income and carry on building new homes during the era of austerity.
He left the role when he was appointed chairman of the Conservative Party.
A Ministry for Housing, Communities and Local Government spokesman said: 'We are determined to fix the housing crisis we have inherited through our Plan for Change, and we know that having too many second and empty homes in an area can drive up housing costs for local people and damage public services.
'That is why local authorities have powers introduced by the previous government to choose to add up to 100pc extra on the council tax bills of second homes and up to 300pc on empty homes.'
