A WELSH Government statement on measures to tackle a rural holiday home crisis has been branded “extremely disappointing” and criticised for not going far enough to address the issue.
Housing minister Julie James announced on Friday plans to undertake further research on the issue of second homes and short-term holiday lets, as well as more regular checks on businesses said to be “exploiting a tax loophole.”
While not ruling out a change in the law, it was stated that a full impact assessment would be needed before any such moves could go ahead.
She promised the Welsh Government would “explore the potential” of a statutory registration scheme for all holiday accommodation – including short-term lets such as AirBnB’s, as is already the case in Scotland.
It follows sustained calls for action from local authorities including Gwynedd and Anglesey.
The minister highlighted how Wales already allows authorities to charge a council tax premium on second homes, but acknowledged “growing concern” in some areas about the impact of second homes on communities, access to housing and affordability and the Welsh language.
“Whilst not a pan-Wales issue,” she added, “It is one that is affecting communities and provokes strong feeling at local or hyper-local levels.”
Welcoming the “creative use” of councils in using the cash generated to develop affordable housing projects, the minister also endeavoured to work with the Valuation Office Agency to review how often self-catering businesses are reappraised – following claims that a “loophole” is being exploited allowing them to not pay any domestic council tax at all.
“We are aware of claims that some owners are gaming the system, with a suggestion that they have had their properties listed as non-domestic, self-catering accommodation to avoid liability for council tax premiums.
“The available evidence indicates that properties listed as self-catering accommodation meet the required legal criteria and are being used as short-term lets.
“We have invited local authorities to identify any cases where they believe properties do not meet the criteria so that they can be re-examined: that invitation still stands.”
But following the statement, language campaigners accused the Welsh Government of “lacking substance” and “not going far enough”.
Mabli Siriol, the chairman of Cymdeithas yr Iaith, added: “What we need is for the Government to take action now, rather than conduct further endless discussions.”
While welcoming December’s decision to increase Land Transaction Tax (or stamp duty) by 1% on second homes, she added that ministers have “shown they are unaware of the real scale of the crisis.”
“Only by introducing a Property Act can we truly tackle the current crisis and ensure that the housing market works in the interest of communities, not capitalism”, she said.
Cylch yr Iaith, meanwhile, described the statement as “woefully inadequate,” stressing that a local family living in a home all-year-round was worth more to the local economy than any second home use.
The leader of Gwynedd Council, however, welcomed that the government was “finally” recognising the issue, but “extremely disappointed they do not see the need for swift action.”
“Considerable work has already taken place to provide evidence of the problem and indeed to offer solutions that the Government could and should implement without delay,” said Cllr Dyfrig Siencyn.
“Scotland is already moving ahead with legislative changes – why is the Welsh Government dragging its feet when our communities are begging for action?
“In the short term the Government could address the shameful, and indeed immoral situation, that owners of second homes can avoid paying tax of any kind on their property. It deprives local authorities of using the resource to create housing for local people instead of the properties lost.
“The loss to Gwynedd annually is £5.2m. Why do alleged socialist politicians not see this unfairness and be eager to resolve the matter without delay?
“There is no point giving us the powers to charge a premium on second homes if tax payments can be avoided in full.
“The Government could take action on this issue without any long-winded research or primary legislation. I am calling on them to act now!”