Pembrokeshire votes to make it cheaper to own second home just six months after tripling rate

One of Wales' most popular tourism areas has voted to make it cheaper to own a second home just six months after tripling the rate.

Pembrokeshire councillors have agreed to cut the extra council tax charge on second homes in the area to 150%, just six months after a 200% hike was introduced.

Concerns had been raised that people had been driven away from holiday spots in the area because of the price hike.

Councillors agreed in a meeting on October 17 to reduce it slightly.

According to Welsh Government legislation, local authorities can raise the council premium on second homes to as much as 300 per cent, effectively a quadruple rate.

Long-term vacant properties in the county are also currently subject to a premium council tax rate: 100 per cent after 24 months, 200 per cent after 36 months, and 300 per cent after five years.

Since this financial year, owners of second homes in Pembrokeshire have been paying a 200 per cent premium on their council tax, effectively a triple rate, following an increase from the previous 100 per cent (or double rate) premium.

Currently, Pembrokeshire is projected to experience an 11.14 per cent rise in council tax in the upcoming financial year.

Council members had been advised at the October meeting to support the premium remaining at the current 200 per cent, with the long-term empty property rates also staying at the current levels, and to write to the Welsh Government requesting a reduction in the 182-day criteria for holiday lets rate relief.

But two alternative proposals for a lower second homes premium rate were presented to members; a 100 per cent premium by Conservative group leader Cllr Di Clements, and 150 per cent by Independent Group (IPG) leader Cllr Huw Murphy.

Jon Haswell, director of resources, informed members that reducing the premium to 100 per cent would result in additional financial pressures on the council of £5.2million, leading to a predicted council tax increase of 18.87 per cent against an expected general increase of 11.14 per cent.

Cabinet member for finance, Cllr Joshua Beynon, supported the original recommendations, stating: "Every 25 per cent reduction would reduce the amount raised by the council by £1.3m, already we have a very difficult financial situation, that is the reality of local government finance, we are stretched in terms of demand for services."

Cllr Clements, in her amendment, argued that the council was using second-home-owners as "cash cows," with the revenue raised used to fund the general budget. She said: "This policy is a blunt tool, for me it’s about fairness and proportionality. I question the financial sustainability of this local authority if it relies on these council tax powers; when second home-owners throw in the towel where will the council go? In relation to second home-owners the message [we send] is clear: ‘We don’t want you’."

Cllr Tony Wilcox commented that any reduction in the rate for second home owners would impact on ordinary council tax-payers in the county. "Why are we penalising 85-95 per cent of our own people to pander for a political point?" he asked, adding: "The overwhelming majority of our residents aren’t affected by this, we are going to penalise the majority. I really can’t see how we are contemplating really high council tax rises for the majority of our county."

Cllr Clement’s amendment was defeated and Cllr Murphy’s own amendment was heard, with Conservative group member Cllr Aled Thomas urging his fellow Conservatives to support the independent group, saying: "This is a half-way step, I would hope the group would put their vote behind the IPG."

Council leader Cllr Jon Harvey, who said Cllr Murphy had previously been supportive of the 200 per cent rate, warned: "On this proposal we are talking about £2.6m loss to the council, or about three-and-a-half per cent on council tax.

"What additional services are you prepared to cut, or are you prepared to increase council tax over and above? I am not prepared to justify to our residents why I voted to reduce second homes tax and then put that burden or service cuts on them, they certainly will be worse off in my opinion if this goes through."

After Cllr Murphy’s ammendment was backed, a later proposal by Cllr Alan Dennison to change the empty property premium to 300 per cent after two years was deferred, being considered by the council tax working group before coming before cabinet at its December meeting. The members also decided to pen a letter to the Welsh Government, requesting them to lower the 182-days let threshold.

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