At its meeting on 7 February 2024, the Executive Committee recommended to Council that:

i.       Council Tax be increased for all properties deemed second homes, which are occupied periodically by 100% from 1 April 2025, subject to any exemptions set out in subsequent Regulations and for implementation to be in accordance with those Regulations and guidance;

ii.     the Council Tax Empty Homes Premium be increased to 100% for properties empty for between one and five years (currently between two and five years), from 1 April 2025, subject to any exemptions set out in subsequent Regulations and guidance; and,

iii.    authority be delegated to the Executive Director: Resources, in consultation with the Lead Member for Finance and Asset Management, to amend the Council's policy relating to premiums in line with legislative or government requirements and changes. 

95.16         At its meeting on 7 February 2023, the Executive Committee considered the Council Tax premiums and recommended to Council that Council Tax be increased for all properties deemed second homes, which were occupied periodically, by 100% from 1 April 2025, subject to any exemptions set out in subsequent Regulations and for implementation to be in accordance with those Regulations and guidance; that the Council Tax Empty Homes Premium be increased to 100% for properties empty for between one and five years (currently between two and five years), from 1 April 2025, subject to any exemptions set out in subsequent Regulations and guidance; and, that authority be delegated to the Executive Director: Resources, in consultation with the Lead Member for Finance and Asset Management, to amend the Council's policy relating to premiums in line with legislative or government requirements and changes. 

95.17         The report which was considered by the Executive Committee had been circulated with the Agenda for the current meeting at Pages No. 53-59.

95.18         As Chair of the Executive Committee, the Leader of the Council proposed the recommendation of the Executive Committee and advised that Members were voting on the principle of the scheme as the full detail was yet to be provided by the government.  The proposal was seconded by the Lead Member for Finance and Asset Management who indicated that the report outlined a scheme to set increased Council Tax premiums for properties in the borough defined as either second or empty homes. This proposal was linked to the Levelling Up and Regeneration Act 2023 which gained royal assent in October 2023.  It was important to note that these recommendations were to be launched and communicated across the coming months, with implementation planned for the 2025/26 financial year.  Although there may be some additional funding to the Council, the aim of the scheme was to encourage property owners to bring their properties back into full use in line with the Act.

95.19         A Member sought clarification as to what the Leader of the Council had meant by saying that Members were voting on the principle of the scheme and was advised that the full details, including the exemptions, were yet to be received from the government so Members could only vote on what was before them.  A Member drew attention to Page No. 63, Paragraph 1.8 of the report which talked about the concern that couples who owned a second home may claim they were living separately and were single occupants of each respective property; she was sure many people would be in that situation and asked if it was down to the Council to carry out checks in relation to that.  The Director: Corporate Resources confirmed this was an internal piece of work carried out by the team using checks on data sources.  A Member sought clarification as to what ‘periodically’ was defined as in terms of the occupation of second homes as set out in the recommendation and how Airbnb properties fitted into the proposal.  The Director: Corporate Resources drew attention to Page No. 63, Paragraph 1.7 of the report which explained that, depending on how long properties were available to let, they may be rated as Business Rates by the Valuation Office Agency (VOA) – this was not a Council decision and was subject to provision of appropriate evidence to the VOA.   A Member sought clarification as to whether the 247 properties classed as second homes would be marketable properties meeting the requirements to bring them back into use as there was a suggestion the majority were in rural villages and would not be.  In response, the Director: Corporate Resources confirmed they were marketable and the majority were in rural areas.  In response to a query regarding the exemption for properties undergoing major repairs, Members were advised that the exemption was for 12 months and, if the works exceeded that timeframe, the owner could apply to the VOA to be taken out of the valuation.

95.20         During the debate which ensued, a Member expressed the view that, historically, Council Tax had been to pay for local services and there had previously been a discount for second home owners on the basis they did not use as many services.  Whilst he understood the intention behind the scheme, he was of the view that introducing very high charges for something which had not been a problem in the past, and distinguishing between those occupying properties or not, could be an incentive for some to game the system.  Charging people twice as much for a second home could ultimately cause families to break-up and it would be naïve to think that the relatively small amount of money it would bring to Tewkesbury Borough would outweigh the additional problems associated with it.  Another Member felt this was missing the point – it was not about money, it was about bringing empty homes back into use to help to address the significant housing need within the borough.  A Member made the point that, as a Council Tax payer, he did not use all of the services provided but that was not a reason for him to stop paying Council Tax.

95.21         A Member indicated that he was supportive of the approach but was mindful of the length of time that probate was taking following the pandemic.  The Leader of the Council confirmed that was something he had also raised and was at the forefront of his mind.  The Director: Corporate Resources advised that this was covered at Page No. 65, Paragraph 2.5 of the report which set out the government proposal that properties undergoing probate would be exceptions to both the second homes and empty homes premiums for 12 months.  A Member indicated that he was fortunate to have a second home which he rented out and, in his opinion, if someone had a second home which they could afford to keep empty they could afford to pay the additional Council Tax for that privilege.  A Member agreed with the principle of the scheme, particularly for homes which stood empty or derelict, but raised concern there may be ways for people with second homes to avoid having to pay the additional Council Tax and an extra burden would be placed on the authority in having to police that.  Another Member shared the view already expressed that the main purpose was to bring empty homes back into circulation and if this scheme could achieve that it would be worthwhile.

95.22         A Member confirmed he was entirely in support of the principle of the scheme but had voted against it at the Executive Committee meeting as he did not feel his concerns had been dealt with.  He was uneasy that Members were being asked to vote on something based on government guidance which had not been received and exceptions which had not been confirmed.  He noted that the report stated there would be no resource implications other than Officer time and he raised concern that this was an unknown quantity, particularly considering the small amount of money which the scheme would bring in.  People with second homes would be able to circumnavigate the scheme to evade the additional changes and whilst that was not a reason not to go ahead, it was important to be satisfied the necessary resources were available.  At the Executive Committee, a desire had been expressed for the County Council to contribute towards those resources, which may or may not be possible, but, given the County Council would benefit financially, he felt there should be some element of support.  In his view, it would be preferable to defer a decision until there was more clarity on the detail behind the principle.  A Member explained that the reason for the proposal being brought to this meeting was due to the need to give 12 months’ notice of implementation of the scheme which, if approved tonight, could be included in the Council Tax bills being issued for April 2024/25; a deferral would mean Officers would have to wait to start that work which could result in the need for a second Council Tax billing part way through the year, or further delay in implementing the scheme.  She pointed out that the majority of the exemptions already existed and, in a way, these complicated the report which was simply asking Members to agree to the principle of the scheme.  With regard to the legal implications, a Member noted that, if the Council wished to adopt any changes arising from the Levelling Up and Regeneration Bill, it was required to make a resolution confirming its requirements by no later than 31 March 2024 and questioned whether he was right in thinking that, if the Council did not make that resolution tonight, it would not be able to collect the additional charge for second homes.  In response, the Associate Director: Finance clarified that the scheme could still be implemented at a later date but 12 months’ notice was required and Council Tax bills were being issued over the next couple of weeks so it would be a case of rebilling.  A Member expressed the view that the proposal should be supported as any properties which could be brought back into permanent use would assist with the vitality and sustainability of villages in the borough. 

95.23         Upon being put to the vote, it was

RESOLVED            1. That Council Tax be increased for all properties deemed second homes, which are occupied periodically, by 100% from 1 April 2025, subject to any exemptions set out in subsequent Regulations and for implementation to be in accordance with those Regulations and guidance.

2. That the Council Tax Empty Homes Premium be increased to 100% for properties empty for between one and five years (currently between two and five years), from 1 April 2025, subject to any exemptions set out in subsequent Regulations and guidance.

3.  That authority be delegated to the Executive Director: Resources, in consultation with the Lead Member for Finance and Asset Management, to amend the Council's policy relating to premiums in line with legislative or government requirements and changes.