30 November 2001
The proposals allow councils to reduce or scrap the 50% reduction enjoyed by people who own holiday homes or other properties that are empty for more than six months. The decision to scrap the discount, available on 500,000 properties, would be at the discretion of each authority.
It is intended to help councils, such as those in the West Country and the Lake District, which have large numbers of holiday homes within their boundaries.
Raynsford said the measure was a 'modest contribution towards dealing with some of the distortions' in the system.
'In some areas, second-home owners bring a much needed boost to the local economy, but, in other areas, a high demand for second homes is pricing local people out of the property market and undermining the viability of local services,' he added.
Councils are being asked how the extra revenue raised should be spent. Options put forward for consultation include ring-fencing the proceeds to pay for social housing; pooling the extra funds and sharing them among all authorities; or allowing each council to keep the money raised locally.
The Local Government Association gave the consultation document, published on November 23, a cautious welcome. LGA chair Sir Jeremy Beecham supported giving authorities the right to scrap the discount, but was non-committal on the proposals for spending the proceeds.
'The LGA will be seeking the views of its members to determine the extent to which any additional income raised should be retained for social housing purposes or used more generally,' he said.
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