Owners of second homes accused of exploiting loophole to beat council tax rise

Published on Thursday 8 May 2008 22:31

MONEY for affordable housing in the Highlands is being lost as second homeowners reclassify properties to avoid the council tax, it has been claimed.

Council tax on holiday homes in the region has been raised to 90 per cent. This has raised an extra 2.4 million a year, which the council reinvests in affordable accommodation. But it has been claimed some second homeowners are reclassifying them as self-catering units, exempting them from the charge.

In 2004 there were 1,906 self-catering units in the Highlands, but by the following year, when the council tax change came, in the figure jumped to 2,230 and there are now 2,578.

The council says there is no evidence of a "general stampede" from council tax to non-domestic rates.

But councillor Dr Michael Foxley, said: "We need to minimise the concealment and need more information about where funding has gone. With the possible change in future to a local income tax, we need to make sure we maximise our income from holiday homes which are a real blight in some areas."

He said over 50 per cent of housing in west Arndamurchan is now holiday homes: "We need to ensure they provide income, to provide affordable housing for local people."

The council says over 40 affordable housing projects or feasibility studies have been funded since 2005.