Thursday, May 18, 2006

Missing a trick on Council Tax

Has the Government has missed a trick? From April 1st 2004, local authorities have had the discretionary right to abolish the long-standing discount on council tax for empty property. For too long this discount had acted as a perverse incentive to keep property empty.

While they were allowed to keep the extra income raised from the abolition of the second homes discount, local authorities were not allowed to keep the income raised from the empty homes discount. Last year we highlighted that both the Mayor of London and Kent County Council were urging the Government to allow local authorities to keep this additional income for work on empty homes.

But the Government has refused to budge on this issue. Yet at a time that they are introducing new powers on empty homes for local authorities, wouldn’t it also be a good time to agree to a source of income to encourage local authorities to invest in tackling this issue?
A key issue that I hear as I travel across the country is that the Government’s ambitions for work on empty homes could be undermined by a lack of funding. At a stroke the Government could allow local authorities to retain this council tax income, so ensuring that they have both the tools and the funding – then we could really see some progress on empty homes. What do you think?

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