Second homes could be hit by double the full rate of council tax under new plans

Second homes could be hit by more than double the full rate of council tax under plans to help increase available housing in Scotland.

First Minister Humza Yousaf said the new proposals aimed to strike a balance between ensuring a good housing supply and helping communities “to thrive and benefit from tourism”.

The Scottish Government has launched a joint consultation with Cosla, the council umbrella body. The proposed changes would enable councils to charge up to double the full rate of council tax on second homes from April 2024, bringing them in line with long-term empty homes.

The consultation will also contain plans to charge more than double the rate on both empty and second homes in future years. The latest figures show that in January 2023 there were 42,865 long-term empty homes in Scotland.

First Minister Humza Yousaf

Elsewhere, the consultation will ask for views on whether there should be changes to the definition of when a property offering self-catered accommodation becomes liable for non-domestic rates. Currently, this happens if it is let for a total of 70 nights and is available to let for 140 nights in a financial year.

Mr Yousaf will announce the plans at the Scottish Trades Union Congress today. He said: “We want everyone in Scotland to have an affordable home that meets their needs and this work to improve the availability of sustainable long-term housing opportunities is a core part of that.

“By recognising the important role councils have in considering local needs, these proposals aim to strike a balance between good housing supply and helping communities to thrive and benefit from tourism.

“I encourage anyone who is interested to respond to the consultation as we try to prioritise homes for living in, seeking a fair contribution to local services from everyone and recognising the benefits to local economies from self-catering accommodation and second homes. All responses will be carefully considered before legislation is introduced to the Scottish Parliament.”

Councillor Katie Hagmaan, Cosla’s resources spokeswoman, said: “Local government in Scotland is committed to supporting access for everyone in Scotland to an affordable home. That is why we are pleased to be launching this joint consultation, as we work to meet the shared aim of creating the right balance to increase the availability of housing and a taxation system that is fair for the tourism industry.

“We also welcome the greater fiscal empowerment for councils to reflect local circumstances this would introduce. Any additional funding created by these changes under consultation will enable councils to invest in local needs and support sustainable communities.

“We are pleased to be jointly working with the Scottish Government on this vital area of work and we look forward to considering the responses.”

The consultation opens on 17 April and is expected to run for 12 weeks until 11 July.

Scottish Labour housing spokesperson Mark Griffin said the proposals are a “pale imitation” of his party’s plans. He said: “Under the SNP, Scotland has developed a housing crisis that has priced thousands out of the market and left many more in precarious residential situations. Tinkering around the edges won’t do. Humza Yousaf must learn from Labour and implement a proper council tax accelerator on empty homes to fund a £1 home policy.”