During a meeting of Gwynedd's full Council today, Plaid Cymru's Gwynedd Leader revealed that nine local authorities in Wales are supporting Plaid Cymru's campaign to change the Local Government Finance Act to try and prevent second home owners from moving their houses from the Council Tax rate to the Business Tax rate.
Councillor Dyfrig Siencyn, Plaid Cymru’s Gwynedd Leader
Owners of holiday homes or second homes are currently able to move their properties to Business Tax rate avoiding payments which help local governments pay for bin collections, recycling, road maintenance, street lighting and more.
Councillor Dyfrig Siencyn, Plaid Cymru’s Gwynedd Leader said: “The fact that owners of second homes can move their properties to the Business Taxation system prevents authorities from charging a premium on those houses. This is a policy that Plaid Cymru has been campaigning for over a number years and that campaign was successful in 2014.
“But because there is a legal loophole many take advantage of the situation and prevent local authorities from using a key source of funding to ensure that investment can be made in housing for local people who want to buy or rent homes in their communities and protect essential local services.”
In Gwynedd, over 1250 properties have transferred from Council Tax rates to Business Tax rates since April 2014. This is an annual loss of up to £2million which could be used to pay for essential public services for Gwynedd residents.
Gwynedd Council’s research also estimates that there is a loss of £4.5m to the public purse throughout Wales as a result.
At a recent national meeting of the Rural Forum, a sub-group of the rural authorities represented on the Welsh Local Government Association, nine local authorities agreed with Plaid Cymru's Gwynedd proposal that a clear principle should be set that all domestic properties remain domestic properties regardless of their use, with a condition that planning permission must be obtained for that property to be used as a business.
Councillor Dyfrig Siencyn said: “I am pleased that we have received the support of the nine authorities that form part of the Rural Forum. The Welsh Local Government Association will now arrange how best they take this matter forward to Welsh Government for consideration. Pressure from nine local authorities will make a strong case to Welsh Government that action needs to be taken.
“Many areas of Gwynedd, particularly coastal communities, face huge pressures due to the high percentage of second homes. The result is that house prices go beyond the reach of local families, especially young people.
Councillor Dyfrig Siencyn said: “Too many second homes lie empty for much of the year, creating redundant buildings, contributing very little to communities, the local economy and social interaction. In addition, some of these houses stop young people, born and bred in the area, from getting their feet on the property ladder.”
Back in April 2018, Gwynedd Council led Plaid Cymru secured a council tax premium for owners of second homes, raising the total amount of tax payable by 50%.
In addition, Gwynedd Council officials have received positive news that the Welsh Government office was eager to discuss the matter direct so they can fully understand the situation, listen to evidence and look into the issue.
Councillor Dyfrig Siencyn said: “There is now momentum, and hope in the air, following Plaid Cymru’s relentless pressure at county, national and UK level to make a real difference to our communities on this issue. Ensuring change to legislation takes time, but I am confident that we can report again on further progress regarding this taxation issue during the year.”