SOUTH Hams’ 4,000 second home owners are claiming more than £700,000 in council tax discounts.
The figures, revealed by the district council in response to a Freedom of Information request by the Gazette, shocked South Hams MP Dr Sarah Wollaston when we asked for her view.
Now Dr Wollaston, her colleague Gary Streeter, MP for South West Devon, and other senior local politicians at parish, town, district and county level are calling for the discount to be scrapped.
Dr Wollaston said: ‘It is shocking to hear that there are 4,162 homes qualifying for the second home discount of 10 per cent.’
Mr Streeter said: ‘I do not believe second homes should qualify for any council tax discount and I am looking to see this policy changed.’
Salcombe mayor Roger Moore, whose town has almost 700 second home owners in receipt of a discount, said: ‘There is no logical reason in giving a rebate to second homes.’
POLITICIANS are united in their calls to scrap second home owner discount, which is costing the district over £700,000 this year.
Following a Freedom of Information request from South Hams Newspapers, South Hams Council has revealed a total council tax discount on 4,162 second homes totalling £702,796 for the tax year 2011/2012.
Owners of a second home can claim a 10 per cent discount on council tax.
South Hams MP Dr Sarah Wollaston said: ‘It is shocking to hear that there are 4,162 homes qualifying for the second home discount of 10 percent.
‘The district council have long acted responsibly in charging the maximum allowable and it is a shame that, having made this decision in 2005, only 10 percent of the rise could be retained locally to be ploughed back into affordable housing.
‘That said, we would lose even more revenue if owners switched to business rates and changing the law to prevent any discounting of council tax could drive many more to do so. ‘While welcoming the boost to local employment and businesses brought by our second home owners, there is no doubt that some communities have been particularly hard hit by the scale of second home ownership and it comes as no surprise that there are almost 700 registered second homes in Salcombe.
‘I would like to hear from readers whether they feel that the council should be able to insist on planning permission for change of use in communities which are particularly affected in this way.’
South West Devon MP Gary Streeter said: ‘I do not believe second homes should qualify for any council tax discount and I am looking to see this policy changed. We want to encourage more owner occupation in this part of the world to keep our towns and villages alive.’
In Salcombe alone there was a discount of £135,829 from its 692 second homes in 1,752 domestic properties.
Salcombe mayor Roger Moore said: ‘In today’s environment there is no logical reason in giving a rebate to second homes, the dwelling exists and therefore councils must structure their services to support the dwelling whether occupied or not.
‘Having been a second home owner, in Salcombe, for 35 years while also having property in Germany and the US, the UK is the only country having this system.
‘The monetary effect of the tax loss is felt at county and district level, while the individual parishes and towns suffer in a more community sustainability manner. The figures are further masked by a number of homes being classed as businesses, their revenues go directly to Central Government (and rarely return!).
‘I calculate that in Salcombe we have some 200 or so of this category, thus giving a total of 900 to 950 houses or some 45 per cent being second homes.
‘These homes do contribute greatly to our economic health, bringing a lot of revenue into the town in the summer months, and generate local employment throughout the year, however the sheer number of second homes has a negative effect on our community sustainability with respect to our local clubs and associations.
‘I am however certain that the vast majority of our second home owners are like me, they really want to live here.’
There are 2,996 domestic properties in Kingsbridge banded for council tax with 186 of those being second homes and in Thurlestone there are 627 domestic properties with 209 homes qualifying for second-home owner discount.
Kingsbridge mayor John Binns: ‘Second home ownership is surprisingly high countrywide. It does take up housing stock and raise prices, limiting first-time buying. However, it can and does provide income to the town via the visitors it brings and indeed many people who have settled permanently in Kingsbridge have done so because they saw the benefits of living here via holidays in ‘second homes’ owned or rented.
‘I would welcome a review aimed at increasing the council tax contribution to 100 per cent but it must also clearly address the implications of doing this. By this I mean the equality of expectations now given to the second home owners.
‘I would also like to see better incentives for ‘out of season’ letting of these properties to provide medium-term accommodation.
‘Monies raised from 100 per cent council tax could be used to provide such incentives.’
South Hams Council chairman Cllr Rufus Gilbert, who represents Kingsbridge North, said: ‘If second home council tax were to be raised further, it is more than likely that Devon County Council would retain the majority of it. I’m sure that many second home owners would not object too strongly to an increase, if they felt the money was going to provide housing for local people, as many did the last time it was raised.’
County councillor Julian Brazil, who stood for the Liberal Democrats in the Totnes constituency at the last general election, said: ‘I have long argued that rather than getting a discount, second homes should pay double council tax – 200 per cent. This would raise over £7m in the South Hams. This extra revenue could then be invested in affordable housing for local families and/or supporting local services including cottage hospitals and local buses.
‘No one likes tax increases but this is a fair tax in that people who are lucky enough to own not one but at least two properties can afford to pay the extra tax.
‘House prices in this area have more than doubled in the last 10 years – in other words if you had a second home worth £300,000 in 2000 it’s now worth over £600,000 and you’ve made over £300,000. All we’d be asking is that you pay a small fraction of that gain as double council tax.
‘Of course if you didn’t want to pay the extra tax you could always let the property out to a local person or family.
‘It would also help to dampen down the second home market as people might think twice on buying a second home here if they have to pay in the region of £4,000 per year council tax.
‘In short a double council tax on second homes is progressive, would bring more homes into the rental market, would dampen down the second home market and raise a massive £7 million plus which could be reinvested in our local communities.
‘In July 2006 I proposed a motion at SHDC, which was unfortunately defeated by the majority Conservatives. In order to change the rate of council tax on second homes there would need to be a change in primary legislation, which can only be done at Westminster – MPs’ views on this matter are paramount.’
Dartmouth has 3,416 properties of which 628 are second homes which qualify for 10 percent council tax discount, amounting to £100,534.
The parish of Newton and Noss has 1,008 properties banded for domestic council tax. Of this figure 118 are second homes which qualify for the 10 percent council tax discount amounting to £23,092.
Ivybridge councillor Mike Saltern, South Hams Council housing spokesman, said: ‘Clearly South Hams Council has long held concerns over the impact of second homes on the availability and affordability of homes across the district. In 2007, we had a Beacon Research study conducted to aid us in reaching a conclusion on this impact. In 2008, in response to a consultation by Matthew Taylor into the rural economy, we made strong representations that second homes council tax should be increased to the full rate without discount.
‘This remains our position, although it would require legislation by the Government to achieve this.
‘It is particularly notable that the previous government, in response to the Taylor recommendations, avoided the issue of second homes other than to propose trials restricting change of use to holiday lets in National Parks.
‘In 2005, the district council was one of the first in the country to increase second homes council tax from 50 percent to 90 percent, the maximum allowable by law. They could, however, only retain 10 percent of this increase and ring fence it for affordable housing, with the remainder being distributed between Devon County Council and other authorities.
‘Initially the county council agreed for their share to be used for affordable housing, but subsequently withdrew this in following years.
‘District council took the decision in 2010 to no longer ringfence their second homes revenue funding, but to put the same amount into affordable housing from its capital receipts.
‘This has retained our commitment to affordable housing.
‘In relation to the figures now quoted, it should be noted that the sum referred to is the total 10 percent council tax equating to the legally required discount, not the share that South Hams would receive.
‘This would be circa £63,000 in apportionment with its share of the council tax. The majority would again go the county council and would not be spent on affordable housing.’
Ben Cooper, district councillor for Townstal said: ‘While I appreciate that Dartmouth, like neighbouring towns and villages enjoy the benefits that second homes bring in terms of visitors to the area, it is difficult to justify the loss in revenue at a time when South Hams Council are beginning to deal with massive cuts in funding from central government.
‘This is especially true when you consider the continued problems local people face finding housing in the South Hams, especially around Dartmouth. ’
Kingswear has 830 properties of which 199 are second homes.
Jonathan Hawkins, chairman of Kingswear Parish Council and South Hams councillor for Dartmouth, said: ‘‘They should pay more council tax, if they can afford a second home, then they can pay more towards them and that contribution could go towards building homes for local people and families.’
Richard Foster, vice-chairman of Stoke Fleming Parish Council said he found it ‘mind boggling’ that there were so many second homes with discount in the area. He said: ‘We (the parish council) feel that those who can afford second homes can afford to pay the extra discount money, and someone has to make up the 10 percent discount.
‘It doesn’t save South Hams Council any money as they have to provide services like the dustbin lorries to go around the same streets, but what it does do is force others to make up the discount by paying more.’
Totnes’s Green Party Devon county councillor Paula Black said: ‘I think these figures sum up the problems that many residents face within the South Hams, a shortage of affordable housing, low wages, and a housing market that is fueled by the second home demand, plus bonus schemes of international companies and the banks.
Carole Whitty, the Labour Party’s prospective parliamentary candidate for Totnes at the last general election, said: ‘The South Hams has the largest number of second homes in the country excepting Westminster and the Isles of Scilly.’
She added: ‘All who live in the South Hams are affected; we lose funding from the perception that we are a wealthy area; we suffer from inflated house prices and, of course, availability of housing stock and from the fact that in some of our villages schools and health provision are on the brink of viability.’
l What do you think? Write or email us using the addresses on the letters page.
Source http://www.ivybridge-today.co.uk/
