Cllr Jonathan Glanz, the Cabinet Member for Housing on Westminster City Council, says that by giving greater discretion to councillors over Council Tax exemptions and discounts, the Government can invigorate localism and promote fairness within communities.
Last week the Communities Secretary made an announcement on ‘Technical Reforms of Council Tax’. It’s hard to imagine a title less likely to thrill the masses or a subject that could more successfully clear a room. Let’s put it this way, the DCLG website has managed to stay online despite the inevitable rush to download the 31 page consultation document. The reforms could, however, be significant for local authorities’ finance and councils’ relationship with the people they serve whilst indicating another small step towards a more localist future.
As well as eliminating Council Tax exemptions for certain categories of empty homes, the reforms will give local authorities the freedom to charge those with second homes up to full Council Tax. At present, authorities have to offer a minimum 10% discount on the 246,000 second homes in England.
This is a new freedom that will be of most interest to urban authorities like Westminster and mainly rural councils like Cornwall which, earlier this year moved to make 13,000 second homeowners in the county ineligible to vote there. In Westminster we have taken a different view to the position of Cornwall Council. Our 7,365 second home owners – including a fair few Members of Parliament – should have as much right to vote here as anyone else providing they make the necessary contribution to the community.
The concepts of taxation and representation have been inextricably linked since the American Revolution; those who pay their fair share should have a say in how those monies are spent and who they entrust to do so. There is also a fundamental issue of fairness at the core of these reforms. Those who can afford second homes in Cornwall, Central London – or to leave properties empty for extended periods – should not get special treatment. They should pay the same as their neighbours who stick around all year making the community and area such an attractive place for others to spend time in and people to want to move into and their contributions can help support those in need or allow councils find local solutions to housing issues.
These reforms will not cost taxpayers huge sums – in most areas a second homeowner qualifies only for a 10 per cent discount on Council Tax – but now more than ever, we must insist upon fairness in the tax and benefits systems. That means everyone paying their way and it means local and central government concentrating benefits and tax deductions on those who need them most.
If you take the view that the current exemption is essentially a benefit, the notion that MPs, Lords or hedge fund managers who choose to run a second home in the centre of the one of the world’s most expensive cities should qualify for a public subsidy of £100 per year is somewhat out of kilter with the mood of taxpayers so ministers are right to prioritise this small but important reform.