Lord Flight calls for Government rethink or risk Buy to Let crisisMake Text Bigger
Lord Howard Flight a Tory Peer and former Shadow Chief Secretary to the Treasury has written in the website “conservativehome – the home of conservatism” criticising the sudden attack on Buy to Let by his own party.
These attacks include the restriction of mortgage interest relief and a 3% Stamp Duty surcharge on second homes and investment property.
Lord Flight said “I hope the Government will re-think its sudden attack on Buy to Let this summer and autumn. Otherwise, it risks the very crisis in the Buy to Let housing and lending markets of which the Governor of the Bank of England has recently warned.”
“A significant increase in those selling Buy to Let properties may also put thousands of tenants’ security at risk as buyers will want to sell with vacant possession.”
Contrary to popular and misleading opinion Buy to let held no tax advantages over standard income tax practices of deducting expenses from income to calculate tax liability and is at a disadvantage to Owner Occupiers in terms of Capital Gains Tax.
Lord Flight went on to say “Buy to Let does not enjoy any of the major tax advantages of pension saving: i.e. tax credits on the amount invested and accumulation of income and capital gains free of tax within a pension scheme. The only Buy to Let tax advantage has been the ability for the interest cost to be offset against an individual’s income to determine their tax bills – the very thing which the Finance Act measure has hit by limiting the tax deductibility of mortgage interest to a 20 per cent tax rate. This will hit more modest Buy to Let investors the most, while many of the more sophisticated have their Buy to Let properties held via a company.”
Last month Lord Flight cc’d the Property118 Campaign Committee into an email to George Osbourne commenting on the restriction of Finance Cost Relief for Individual Landlords. >> http://www.property118.com/lord-flight-disagrees-with-landlord-tax-grab/83055/
In November last year Lord Flight spoke out against the “Landlord tax Grab” in the House of Lords >> http://www.property118.com/conservative-peer-speaks-out-against-tory-tax-grab/82321/
Interestingly as reported by the Telgraph 91 out of 330 conservative MPs (28%) own Buy to Let properties where the definition is a home worth more than £100,000 and bringing in a rental income of over £10,000 per year. 15 MPs have three or more and Bob Blackman MP for Harrow East has the most Buy to Let properties owning six in Welwyn Garden City.
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