A disappointing response from the Welsh Government to the Council Tax Premiums Regulations to Extend the Exceptions consultation
A very disappointing response has been received from Rebecca Evans MS, Minister for Finance and Local Government, to our evidence in support of a new exceptions to councils’ powers to charge premium council tax. As you know, self-catering businesses who cannot hit the 182-day occupancy requirement will be liable to pay council tax, not business rates, as of April.
Why has Welsh Government dragged this out for a further six months, with what appears to be no intention to allow further exceptions? Why delay with a new council tax year looming quickly?
Tuesday’s (28/02/23) announcement adds to what has been exceptionally disappointing eighteen months, with little amendment to the Welsh Government’s proposed policies as a consequence of the WTA's and our partners in the industry's responses to the many consultations released on us by the Welsh Government to date. Resource consuming exercises that we really do not need post pandemic, during a cost of living crisis for consumers and with rising inflation leaning on overheads.
This is also despite positive news that Welsh Government has finally settled on who has responsibility for tourism. And, sadly, a promising meeting with the new (Deputy) Minister for Tourism, Dawn Bowden MS (14/02/23) where we were assured there would be some “positive news” with regard to our request for exceptions from the premium rate of council tax.
However, wires must have been crossed, as her colleague, the Finance Minister, Rebecca Evans MS, seems to have simply ignored the industry response and ruled all our requested exceptions out bar the one we were confident about.
Rebecca Evans’s latest statement (28/02/23) says that she is “pleased to announce” there will be no further exceptions to paying a council tax premium (should the local authority introduce one) unless you have planning permission for holiday use only. We are far from “pleased”.
There was one small 'win', the Finance Minister has conceded what she calls a ‘minor point of technical clarity’ and amended the draft legislation to remove the reference to ‘short-term’. This will ensure that properties which do not have a length of time specified in their holiday let planning condition cannot be charged premium council tax. We are grateful for that clarity (maybe this was the positive news).
We are also increasingly concerned with the continuing assertion by Welsh Government that these changes are designed ‘to ensure property owners make a fair contribution to the communities where they own homes or run businesses’. Despite repeated assurances that officials have now grasped the difference between professional businesses and second homes, this policy suggests they have not.
Where is the differentiation between second homes and resident-run local businesses who are attempting to make a living from those properties that are quite patently unsuitable for use as a primary residence? Both will be punished in the same way.
This leaves the question as to where will Dawn Bowden MS’s influence lie when it comes to championing the industry and challenging other Ministers? We wish her the very best in this endeavour.
New in post in our meeting on 14th February, the Deputy Minister did acknowledge a number of our key concerns recently and agreed to regular meetings to discuss the industry reforms and their impact on all sectors; Furnished Holiday Lets are in the foreground with this particular policy but they are part of a much bigger picture. However, whilst we received assurances that there would be positive news, the response is actually extremely disappointing.
We are also still extremely concerned about the lack of guidance as to how the new classification will be implemented with less than a month to go before the new regulations kick in.
The full ‘Pleased to announce’ statement can be found here: