MP Supports Tax Cuts for Private Landlords
An MP has spoken out in Parliament in support of tax cuts for private landlords, insisting that they should not have been excluded from a Capital Gains Tax (CGT) reduction revealed by the Chancellor in his Budget statement.
Kevin Hollinrake, a Conservative MP and co-founder of Hunters estate agents, believes that George Osborne should not have denied landlords a tax break on their property profits.
Landlords face a hefty 28% CGT bill when they sell their buy-to-let properties, a rate that the Chancellor himself has described as one of the highest in the developed world.
Residential property was deliberately excluded from the tax cut, which will see investors in other asset classes benefit from a reduction from 28% to 20% in the higher rate of CGT, and from 18% to 10% in the basic rate.
Hollinrake is tabling an amendment to Clause 72 of the Finance Bill, which would extend the new 20% CGT rate to private landlords when they sell their rental properties to a sitting tenant.
The motion to put the measure into an amendment to the Finance Bill, which is currently going through Parliament, was originally suggested by the Residential Landlords Association (RLA). The organisation believes that a growing number of landlords are now thinking of leaving the buy-to-let sector, as property investment becomes financially unsustainable for them.
Recent research from the RLA found that a huge 77% of private landlords would consider selling their property to tenants if the rate of CGT was reduced.
The RLA is now urging its members to write to their local MP, encouraging them to back the proposed change to the Finance Bill.
Ahead of the Chancellor’s Budget statement earlier this year, the Royal Institution of Chartered Surveyors also called for landlords to be exempt from paying CGT if they sell their properties to tenants.