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Labour plans holiday home tax to raise homelessness funds

Labour has revealed plans to impose a levy on thousands of second homes and spend the money raised on battling homelessness.

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Picture: Getty
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An average annual tax of around £3,000 would hit properties used as holiday homes under the policy – with as many as 174,000 second homes potentially affected.

The party claims the move could raise up to £560m a year, earmarked to reduce homelessness. It is not clear exactly how the money would be targeted, but Labour indicated it would focus on helping children in temporary accommodation.


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Shadow housing secretary John Healey said: “Britain’s rapidly rising homelessness shames us all. It is unforgivable that under the Tories, the number of children stuck growing up in hostels and B&Bs has skyrocketed.

“Over the last eight years, the Government has turned its back on the scandal of poor housing and homelessness. A housing market that works for the many needs Government action to ensure everyone has a place to call home.

“As part of the next Labour government’s plan to rebuild Britain, we will introduce a levy on second homes used as holiday homes to help homeless families. Labour will act to put a brake on the growing gap between Britain’s housing ‘haves’ and ‘have-nots’.”

Mr Healey is expected to announce the policy to the Labour Party conference during his address this morning.

The levy would double the council tax bill for second properties used primarily as holiday homes rather than those rented out or used for employment, with the extra money sent back to the Treasury rather than kept by local authorities. It would not include static caravans.

Areas like Cornwall and Norfolk would be particularly affected by the policy.

According to thinktank the Resolution Foundation, the proportion of people with multiple homes increased 30% between 2000/02 and 2012/14, up to 5.2 million.

Meanwhile, homeownership among middle earners under the age of 35 has halved in the past 20 years.

The government passed legislation earlier this year to allow councils to charge double the rate of council tax on homes left empty for long periods.

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