Cornish second-home owners face double tax to tackle crisis

Second home owners in Cornwall are set to be charged twice the normal rate of council tax under a proposal to give the local authority more powers to raise income from out-of-towners.

Will Humphries, Southwest Correspondent

Councils would also be given powers to charge a 100 per cent council tax premium on people who leave their properties empty for one year or more.

Cornwall council’s scrutiny committee agreed in principle to the doubling of charges for both categories on Tuesday, and that the leader of the council should write to the secretary of state asking that all English local authorities should have the ability to raise council tax on second homes even to three times the normal rate.

The move followed a request by Julian German, an independent councillor and former leader of Cornwall council, who wants to bring England in line with Wales. The Welsh government introduced a law this year that allows local authorities to set council tax premiums of up to 300 per cent on second homes and long-empty properties.

German told The Times: “If the Westminster government wants to devolve the ability for councils to raise council tax on second homes then why put a cap on it at 100 per cent; why not trust local government to decide what is right for them, be that 150 per cent or 400 per cent?”

The proposals are subject to the government’s Levelling-up and Regeneration Bill receiving royal assent. The bill gives local authorities powers to double council tax on second homes and is expected to be made law in time to apply from April 2024.

North Yorkshire county council, which has the highest concentration of second homes in England, became the first English council last month to pass a measure committing itself to doubling council tax bills on second homes.

At present Cornwall can double council tax only on homes that have been empty for two years or more.

It charges a 200 per cent premium on homes left empty for more than five years and 300 per cent for those empty for more than ten years.

A report to the committee estimated that doubling the rates of council tax on all second homes could generate an extra £27 million in revenue for the authority. According to the report, there are more than 13,000 properties in Cornwall classed as second homes on the council tax system — one of the highest levels in the country.

“Second home ownership within Cornwall is significant and is recognised to have a negative impact in terms of the supply of homes available to meet local housing need,” the report said.

It said data shows 722 properties are being charged a 100 per cent premium for being empty for more than two years, generating £854,000.

Second homes and holiday lets are blamed for an affordability crisis in Cornwall after falling stocks of housing to let led to a sharp rise in rents.

Locals have been upset over recent years by prominent second home owners, including the celebrity chef Gordon Ramsay who came down from London to spend much of lockdown at his second home on the coast.

St Petroc’s, a homelessness charity, said last week that “thousands” of local people were at “breaking point”. The council’s cabinet must vote on the proposal before a formal resolution goes to a vote of the full council.

The people of Salcombe, the Devon seaside town known as “Chelsea-on-Sea” for its wealthy visitors, became so worried about second home owners buying prime properties that they have enacted the strictest code against out of towners in the country.

South Hams district council has made it a legal requirement that all new-build homes must be sold with a Section 106 agreement stating they will be a principal residence in perpetuity.

Several other seaside towns, including St Ives, have introduced rules for new properties to be sold as principal residences but none has dictated that all should remain a principal residence.