Scottish councils to be able to charge council tax premium for second homes

Local authorities in Scotland will be able to charge a premium of up to 100 per cent on council tax for second homes under new legislation which is intended to increase the availability of housing.

The secondary legislation, if approved by parliament, would bring second homes into line with long-term empty homes, which can already be subject to a 100 per cent premium on their council tax.

Currently long-term empty and second homes are subject to a default 50 per cent discount on council tax. However local authorities can vary council tax charges, and most already charge the full rate of council tax for second homes.

The most recent figures show that in September 2022, there were 24,287 second homes in Scotland.

If approved, the new legislation is likely to come into force by April 2024.

Public finance minister Tom Arthur said: “We want everyone in Scotland to have an affordable home that meets their needs. While second homes can bring benefits to local economies, we know they can also affect local housing stock, pushing up prices for those looking to buy or rent. That’s why we’re bringing in this legislation encouraging more housing to be used as homes to live in, seeking a fair contribution to local services from everyone.

“Under the Verity House Agreement between the Scottish Government and COSLA, we have committed to give councils greater flexibility to meet local needs. This legislation shows how we are putting this into action, giving councils more powers over how housing is used so they can meet local needs and support thriving communities.”

 Councillor Katie Hagmann, spokesperson for Convention of Scottish Local Authorities (COSLA) said: “We absolutely welcome the ability for councils to take the decision to increase the premium on second homes up to 100%. This means decisions can be made locally by the elected politicians closest to the people in their communities about what best suits local needs and circumstances.

“This is the Verity House Agreement in action, rightly giving councils greater flexibility for local decision-making to meet local need in their communities.

“We look forward to continuing to work with Scottish Government on this and other elements which were consulted on, and we see this as an opportunity to further improve the council tax system.”

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