How would Labour tax plans affect second home ownership in Norfolk?
PUBLISHED: 11:45 24 September 2018 | UPDATED: 22:00 24 September 2018
Owners of holiday homes in north Norfolk could face a new tax bill under Labour in plans drawn up to help bridge the divide between the "haves and have-nots".
The party said the new levy would tackle homelessness and address rising wealth inequality.
Under the plans, second properties in England used as holiday homes would be subject to an average tax bill of over £3,200.
The sum would be based on the value of the property and equivalent to double the current rate of council tax.
The money raised would be earmarked for councils to help homeless families with children living in temporary accommodation.
Up to 174,000 properties across the country could be subject to the tax, with many in popular tourist destinations like North Norfolk.
There are about 13,000 second homes in Norfolk with 5,359 in the north of the county.
Spencer Cushing, branch manager at Sowerby’s estate agents in Burnham Market, said the policy would have a “marginal impact” on second home ownership.
He said: “When the stamp duty change came in about three years ago that was very much a tax aimed at second home ownership. I think there would be the same reaction to that. It would soften the market.
“It would have a marginal impact, but I think the effect would diminish quicker than stamp duty, as it’s a not a huge chunk of money.
“There’s a misconception that holiday homes are all owned by rich Londoners, but it’s more likely to be people who have inherited a caravan, love the area, and want to invest in a property.”
Back in July North Norfolk MP Norman Lamb demanded an end to a loophole which allows homeowners to avoid paying tax on second homes, which has cost North Norfolk District Council £1.8m this year alone.
In England, any property that is available to let for 140 days or more per year can be registered as a holiday business.
Holiday homes with a rateable value of less than £12,000 are eligible to receive 100pc small business rate relief, meaning that the owners do not have to pay any tax on the property.