The Treasury needs to listen to the economists! Scrap Section 24 now!Make Text Bigger
Ever since the Government announced that landlords would no longer be allowed to offset the finance costs of their businesses, prominent economists have opposed this.
Immediately following the Summer Budget of 2015, Professor Philip Booth from the Institute of Economic Affairs, as well as Paul Johnson from the Institute of Fiscal Studies were invited to scrutinise the Finance Bill and give their expertise.
They both pointed out how this move was ‘plain wrong’ and based on false premises that landlords enjoyed a tax advantage compared to owner-occupiers (when the opposite was the case). One would assume then that as it was a big mistake it would be promptly overturned.
In fact, their evidence was completely ignored.
Over the subsequent 18 months, Professor Philip Booth elaborated on several occasions on his reasons for arguing that this tax levy on ‘individual’ landlords was so wrong. He even stated that it was based on an undergraduate error which should not be made by the Treasury and that George Osborne was either being deliberately dishonest or simply did not understand the issue.
Please see our two articles below about Professor Philip Booth:
Still the Treasury refused to see reason or listen to experts in fiscal affairs, tax and housing.
Dame Kate Barker has now spoken out against the tax levy. Still no u-turn.
Dr Kristian Niemitz, Head of Health and Welfare at the IEA has also published a brief, yet cogent report on the housing crisis in which he states with regard the ‘higher tax for buy-to-let landlords:’
‘The higher tax burden on buy-to-let landlords is also a step in the wrong direction. Letting a property is business like any other, and the cost of servicing the mortgage is a business cost like any other. Thus, the tax system should treat it as such.’ Click here
Still no change; the Treasury continues to stonewall and attempt to disorientate us with what is effectively gibberish.
When will the Government see sense and reverse this nonsensical attack on landlords (but only those with mortgages who are unincorporated)? The architect of it is gone (George Osborne) so what are they waiting for?
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