Kentish Gazette Canterbury & District
‘Student rents will go up if landlords pay business rates’
The city council has been accused of “going round the back door” to tax students after taking steps to charge landlords business rates.
Councillors have voted to lobby government to give local authorities the power to claw back lost council tax from properties rented to students, who currently do not pay anything.
The exemption for students in Canterbury costs the public purse £5.5 million each year. The city council hopes to recoup that money by hitting landlords – both of student homes and houses of multiple occupation - with business rates.
But the move has sparked claims it will result in costs passed onto students, or landlords taking their investments elsewhere.
Simon Day, a Tory councillor for Thanet District Council, rents 10 properties to students in Canterbury.
He said: “The government already decided students were exempt from council tax, but now the council is going round the back door to get the rates off landlords. Essentially, what they’ve voted for is to tax students. Landlords will be left with no choice but to put rents up. Nobody’s going to rent property out at a loss. There won’t be any homes for students.
“It’s just another added cost and will eventually see people deciding to invest in something else. An awful lot of people have invested in property because they don’t trust the pension companies. Where does this leave them? A lot of normal people could be hurt quite badly.”
The council’s move was triggered by a similar approach by Liverpool City Council, which also has a high student population, and comes on the back of claims students or their landlords should be paying for the public services they use.
Cllr Terry Westgate (Con) told a meeting of the council’s community committee: “It’s been a contentious issue for a long time.
“I’ve always thought that landlords with several properties are running a business and should pay rates. The council is going to lose a great deal of money in the coming years, and with so many houses in multiple occupation in Canterbury we are going to be in real trouble.”
Four in five of the city’s privately rented homes – about 3,800 – are occupied by students, but landlords only have to pay council tax when the properties are empty.
Cllr Westgate says the issue “needs addressing” because students place a heavy burden on the council with tasks like rubbish collection. Local residents often say to me it’s not fair and they feel like they are subsiding landlords,” he said.
“Students should be exempt from council tax but landlords should contribute.”
Cllr Jean Butcher (Lab) added: “Landlords are running businesses and making huge profits, but not contributing.”
Council leader Simon Cook will now write to the government and district MPS asking for a change in the rules.