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Wednesday, 30 July 2014

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Tax breaks cost west Cumbria economy £2.3 million

Council tax breaks for empty homes are costing west Cumbria more than £2.3 million every year.

Discounts given to second homes and properties lying vacant suck millions out of the local economy, increasing residents’ tax bills.

Ministers say they want to allow councils to abolish the discounts to spend the cash on services, although the power has not yet been handed over.

Yesterday they claimed that ending the discounts would shave £20 off the average household’s council tax bill.

Currently the owners of properties that are empty are entitled to a range of tax reliefs.

Councils are forced to offer second home-owners at least 10 per cent off their bills, while other breaks apply to homes that are vacant for other reasons.

Campaigners say it is wrong for taxpayers to be subsidising wealthy homeowners and landlords of empty buildings at a time of service cuts and housing shortages.

The impact of the discounts on the local economy is revealed by figures published in the House of Commons Library.

Council services in Allerdale would be boosted by £1.397m if all discounts were ended.

This figure includes £532,000 relating to long term empty properties, and £490,000 for properties vacant for less than six months.

In addition a £215,000 subsidy is currently being given to second home-owners, and the rest is on properties being repaired or that have been repossessed.

In Copeland, discounts and exemptions cost £984,000, of which £435,000 is long term empty homes, and £17,000 on homes repossessed.

Campbell Robb, chief executive of the homeless charity Shelter, said: “The council tax discount is effectively a tax break for people with second homes which often lie empty for large parts of the year.

“Enabling councils to respond to local housing pressures and charge the full rate of council tax, or higher, would mean they could raise vital revenue that could be used to deliver affordable housing for local people.”

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