Taylor Scott International News
Private sector rent increases in the UK are inevitable unless MPs move to halt the what the sector believes are unfair tax changes being brought in by the government, it is claimed. The plans to tax landlords on their income rather than after allowances, part of the loss of mortgage interest relief, will inevitably lead to rent increases, according to the Residential Landlord’s Association. Legislation now going through Parliament to implement the Budget will see landlords’ tax bills soar and in some cases will wipe out their profit altogether and as supply of rental homes falls and remaining landlords are facing higher overheads rents will rise to cover costs, the association says. In a recent survey of RLA members, some 84% said that they are likely to consider increasing rents following the Chancellor’s tax hikes which have also included and extra 3% stamp duty charge on buy to let properties. The RLA is now calling for reasonable changes to the Finance Bill to protect both landlords and tenants. It wants the Government to scrap its MIR changes and to remove the stamp duty levy where landlords invest in new property to increase supply in the private rented sector. It has warned this tax raid will have a devastating impact on landlords at a time when the Government needs them more than ever. Some MPs have already voiced concerns. The former Welsh Secretary, David Jones, has called on the Government to stop clobbering landlords whilst the chairman of the influential 1922 Committee, Graham Brady said he has serious concerns about the effect on landlord finances. ‘Landlords do not want to increase rents unnecessarily but many will have to if they are stay in business as a result of these wholly unreasonable tax increases. It is unfortunately tenants who will end up paying the price either through higher rent bills or finding it more difficult to find somewhere suitable to live,’ said Alan Ward, RLA chairman. ‘We welcome the concern of many MPs and hope that they will be able to persuade the Government to change its mind,’ he added. Taylor Scott International
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