Backlash over £170m grants for holiday homes
HOLIDAY home owners received almost £170 million of Covid-19 grants in Cornwall with almost 62% going to people who live outside the county.
New details about the amount of money claimed by holiday let owners were revealed during a meeting of Cornwall Council.
A number of public questions focused on the issue of holiday lets claiming business rates relief as well as how much was claimed in grants during the Covid-19 lockdown.
There has been a chorus of disapproval about the number of holiday lets which are registered as businesses and then claim small business rates relief. This then results in them not paying any council tax or business rates.
Councillors and MPs have been battling for years to close the loophole to ensure that holiday let owners can start to contribute towards the cost of local services.
There were five questions from the public on the issue at this week’s meeting and council deputy leader David Harris made a general comment before answering them individually.
He said: “On an overall basis Cornwall Council does not lose out where second homes qualify for business rates then get small business rates relief as all these various reliefs and the Covid grants come from central government.
“However we do not believe that it is right that this broad exemption should exist in its current form and we have already asked central government for greater tax raising powers here. Apart from anything else these properties do not pay local or police precepts which is just wrong and unfair on everyone else.
“In relation to the Covid grants I made very strong representations at the time that these should not just be paid out automatically to these holiday let businesses and that there was a technical wording that backed up my argument, unfortunately civil servants in London didn’t agree with me and I got nowhere.”
On the question of the cost of holiday lets claiming business rates relief, Cllr Harris said: “The current cost of small business rate relief is £17,886,098.52, while administered by Cornwall Council it is covered by central government as already mentioned.”
Other questions revealed that there are currently 13,255 second homes recorded on the council tax database and that there are 11,081 holiday lets registered for business rates, with 8,953 getting business rates relief and 8,869 paying no business rates.
On the issue of Covid grants it was revealed that 61.8% of the holiday lets in Cornwall which claim small business rates relief and received Covid grants were registered to people living outside Cornwall.
And it was revealed that 7,440 holiday lets receiving small business rates relief in Cornwall received one or more Covid-19 grants during lockdown. The total paid to those businesses was £169,702,267.81.
Commenting afterwards Liberal Democrat councillor Andrew George said that £100m of the Covid-19 grants should be returned and used to tackle the housing emergency.
He said: “Cornwall Council confirmed that £169 million of Cornwall’s Covid aid was paid out to the holiday home and second homes sector and that at least £104m of which has been paid to owners who live outside Cornwall.
“I have campaigned against the introduction of the small business rate relief tax loophole which provides the basis of this shocking misuse of public money since it was first introduced by the Conservatives in 2012.
“I also warned in March last year that unless the Government amended its Covid aid plans this would happen. It is time the Government sought to recover these monies and ensured they are deployed to address the shocking circumstances of local families suffering the housing emergency, which is in part caused by the growth of second homes and the way our stock of homes are used as investment and leisure toys for the wealthy.”
These properties do not pay local or police precepts which is just wrong
CLLR DAVID HARRIS