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Appendix 2: SUMMARY OF EVENT REPORTS
The Scottish Government held 2 stakeholder discussion events on the taxation of empty and second homes; these took place in Edinburgh and Inverness during July 2008.
A total of 8 organisations attended and these included representatives from:
- 5 local authorities (with high levels of second homes);
- a National Park;
- a rural property and business association;
- a communities housing trust.
At both consultation events on taxation of second and empty homes, participants agreed that it is important for local authorities to be allowed to vary the level of tax within their areas and also between second and empty homes; this could be informed by local housing policy.
Local authority representatives at the events felt that, while it was unlikely that they would vary the rates, they should nevertheless have the power to do so. Participants felt there should be a clear, fair and simple framework within which local authorities could vary rates.
It was noted that second homes contribute to local economies and that tax on these homes offsets any negative impact on the housing supply. But participants did not think a tax on second and empty homes should raise more money than the council tax currently paid on these properties; they felt that radical changes could have consequences for local economies.
At the Edinburgh event, participants saw the potential for taxation rates to help reduce the number of empty properties. Participants at the Inverness event did not agree.
At both events, participants agreed that any second homes tax should reflect the property value.
On the subject of tax collection, participants at both events agreed that taxes on second and empty homes should be collected through the non-domestic rates system. The issue of identifying these properties was discussed and possible sources of information identified included the corporate address gazetteer and the land registry database.
Participants also discussed how the tax might be spent by local authorities and the issue of ring-fencing for investment in affordable housing was discussed. Opinions differed on this issue; some participants were strongly in favour while others felt local authorities should be allowed to decide their own priorities. Participants were concerned that ring-fencing would be removed given the concordat between COSLA and the Scottish Government and that this money would be lost to other services; this was seen as a particular disadvantage for rural, especially small remote, areas. If ring-fencing remains, participants felt it should extend to all tax raised on second or empty homes.
Participants agreed the need for flexibility on how revenue for this source is used to support affordable housing and this could include the revenue stream being opened up to the most appropriate developers and broadening what the revenue can be used for.
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