A new study by a Tory think-tank is demanding the government scraps tax reliefs for buy to let landlords to stop growth of the sector.
The report came from Conservative MP Neil O’Brien – who was a special adviser to former Chancellor George Osborne and Prime Minister Theresa May – has joined with think-tank Onward, led by former Tory darling Will Tanner.
Tanner was May’s former deputy head of policy.
The study blames buy to let landlords for ‘locking’ more than 2 million families out of owning their own home because buy to let investors have snapped up huge numbers of cheaper homes.
Foreign owners – including British expats – also bear some of the blame.
“We can’t solve the housing problem with one hand tied behind our backs. As well as building more homes, we need to change the balance between the rented sector and home ownership,” said O’Brien.
“We should protect existing landlords but discourage more people from investing in rental property, because the buy-to-let boom has bid up prices and reduced home ownership among younger people.”
Onward demands landlords buying homes should have the same tax treatment as owner-occupiers, rather than receiving mortgage interest relief and discounted capital gains tax.
However, it’s not clear if the call is for landlords not to pay CGT in the same way as owner-occupiers do not.
Onward director Tanner said: “If the government wants to regain the support of young people and win the next election, it must be unflinching in its pursuit of greater home ownership.
“That means hard choices, like ending tax breaks for new landlords and giving councils much stronger powers to assemble land for new towns and villages. But it doesn’t mean, as so often is said, concreting over the green belt or steamrollering local opposition. We must build the homes Britain needs while protecting the views and places people love.”
Usual ignorant political suggestion, same as granting tenants extended tenancy rights. Would end with far less homes to rent for tenants.
That’s the intention of the proposal.
The main problem I have with this proposal and previous mortgage interest tax changes, aside from the massive tax hike imposed on me, is the woolly language and nonsensical logic being used. Mortgage interest is for many landlords their largest expense. It is standard accounting practice to treat the costs of loans used to finance any business as an expense and deduct this from income before calculating tax. So to refer to this process as a “tax break” or “tax relief” is completely misleading as it suggests that landlords are being given some sort of special treatment, which they are not. In addition, if you adopt the standpoint that landlords must be placed on a level playing field with home owners and take this to its logical but absurd conclusion you may as well stop landlords from making any deductions for maintenance expenses too. After all home owners are not allowed to deduct the cost of their home boiler repair when calculating their income tax so why should landlords? The rabbit just fell deeper down the Conservative think tank hole!
I totally agree with the above comments They (the government) have persecuted Landlords in every way they can and if they force good Landlords to sell up then they get the added bonus of hitting us with large Capital Gains Tax bill as well I have voted Tory all my life but will no longer do so as I cannot see sense in anything they have proposed