North Wales MS Mark Isherwood has today called on the First Minister to respond to holiday let business owners in Denbighshire and Flintshire who are being forced to close because of the Welsh Government’s 182-day second home council tax rule.
From April, holiday lets in Wales have had to be rented for 182 days in a year before they qualify for business rates, leaving owners at risk of new Council Tax premiums of up to 300%.
Since the new rule was first proposed, Mr Isherwood has repeatedly highlighted to Welsh Government Ministers the impact of the changes on legitimate holiday-let business owners in North Wales.
In today’s meeting of the Welsh Parliament, he raised the issue again when questioning the First Minister on how the Welsh Government evaluates the socioeconomic impact of its policies in North Wales.
“Well, as a constituent e-mailed a fortnight ago regarding the 182-day threshold for holiday lets: 'Same old is being trotted out by the Welsh Government. None of their statements is being borne out by facts. Every one has been dreamed up to prop up the rhetoric.'
“Regarding the socioeconomic impact, a survey commissioned by Wales Tourism Alliance, UK Hospitality, and the Professional Association of Self-Caterers UK already shows that fewer than 25 per cent of Welsh self-caterers will hit the threshold in this year of soft demand, higher mortgages and a cost of living crisis, even though over 70 per cent have said that they are discounting to try and achieve it.
“How, therefore, do you respond to the legitimate holiday small business owner in Denbighshire, who e-mailed: 'We've taken the decision to cut our losses, salvage what's left of our mental health and close down', and to the legitimate self-catering small business owner in Flintshire, whose property is now on the market, who e-mailed: 'A number of major lenders have said that they would not provide mortgage support, which would seriously affect people's ability to sell their property'?
“These are two examples, sadly, among many that I am receiving.”
The First Minister replied:
“The Welsh Government's policy is there for a reason. It is there to distinguish properly between holiday lets that are organised on a commercial basis and those that fall below a commercial threshold. The number of days that a property has to be available for letting, and the number of days that it has to be let, are there to make that distinction.
“If you are a business, then it is reasonable that you let your property for the number of days that we now require in Wales. If you don't do so, that doesn't mean
that you can't go on letting your property, it simply means that you don't benefit from the business rate reliefs that would otherwise be available to you; you simply pay the council tax like everybody else and you let your property for fewer days. There's nothing unfair about that. What it actually is, is fair to every other taxpayer.”
Speaking after the meeting, Mr Isherwood said:
“As I have previously said, by introducing these changes, the Welsh Government is condemning large numbers of legitimate Welsh holiday-let businesses to paying these increased Council Tax premiums, driving many out of business in consequence and therefore further undermining our rural tourism economy.
“The First Minister and his Government are directly responsible for killing these bona fide businesses.”