Finance and Taxation Reform

Conservative Peer attacks cash grab on landlords

Sally Walmsley
Written by Sally Walmsley

A senior Conservative Peer has accused the former Chancellor, George Osborne, of exacerbating the housing crisis through his cash grab on landlords.

In an article for the RLA Lord Flight, who previously served as Shadow Chief Secretary to the Treasury, warns that the decision to tax landlords on income instead of profit and bring in 3% surcharge on buy-to-let homes will drive up rents and drive out investment. All at a time when 1.8 million new homes to rent are needed by 2025.

In his article, Lord Flight points to evidence from the London School of Economics that undermines the previous Government’s claims that landlords are buying up homes that could have been sold to first time buyers.

He also highlights assertions by the Institute for Fiscal Studies that landlords are taxed more heavily than homeowners.

Lord Flight is now calling on landlords to lobby their MPs to tell them about the damaging impact the tax changes will have on the supply of affordable homes to rent and encourage them to seek changes in the new Chancellor’s Autumn Statement on November 23.

RLA Chairman, Alan Ward, said: “Lord Flight’s analysis is correct. When we need almost two million more homes to rent by 2025, recent tax changes will choke off investment, increase rents and make it more difficult for tenants to save for a home of their own.

“The new Chancellor has an important opportunity next month to correct the previous Government’s changes to the way the rented sector is taxed. We call on him to seize this opportunity with both hands.”

About the author

Sally Walmsley

Sally Walmsley

Sally Walmsley is the Communications Manager for the RLA and award-winning Editor of RPI magazine. With 16 years’ experience writing for regional and national newspapers and magazines she is responsible for producing articles for our Campaigns and News Centre, the weekly E-News newsletter and editorial content for our media partners.

She issues press releases promoting the work of the RLA and its policies and campaigns to the regional and national media and works alongside the marketing team on the association’s social media channels to build support for the RLA and its work.

3 Comments

  • What people haven’t realised is that this is not just the odd percent or two on the tax but it analogous to putting up the duty on fuel by ~50p/litre, and it will go straight on the price at the pumps i.e. Tenants will have to pay this #TenantTax or move.

    Pity the likes of Shelter and Crisis support this tax.

    • I have lobbied my MP Damian Hinds 3 times but he maintains the status-quo party line. I believe that the effects of this tax grab that will inevitably filter down to the tenants will not be acted upon until the proof of the pudding is experienced. I have had to notify my wonderful tenants (10 years without a void in 2 properties) that I had no choice but to raise their rents. I have a great relationship with them and I am sad that I have to do this. I strongly suggested that they lobby their MP’s too. There will be another scenario that does not seem to have been mentioned. Landlords unloading properties that will either show a loss or will have a very thin margin will result in tenants losing their homes. The result is that they will appeal to their councils to house them. The councils do not have enough stock to house them. So they will put them in B&B’s which will put further strain the funds of councils who will appeal to government to raise council taxes. This disaster will slowly unfold but for many even if this madness is arrested may be too late as the horse would have already bolted when houses are already sold.

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