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Wednesday, May 16, 2012

Government report recommends tax simplication

The House of Commons Communities and Local Government select committee has recently explored how the economy can generate more housing in its' 280 page document 'Financing of New Housing Supply'.  In one section it looks at the contribution that residential landlords can make.  It concludes rightly that private landlords have a massive part to play in increasing residential supply.  I think that policy makers often overlook the contribution that small private landlords make.  We may not be building huge tower blocks or sprawling housing estates but many small landlords make a huge contribution to housing supply by bringing unused and inhabitable stock back into use or carrying out small scale developments.

The conclusion of the Committee is broadly positive being that :

"We recommend that the Government bring forward a set of proposals to
simplify the tax and regulatory structures that apply to private landlords. These
proposals should aim to create an environment in which small private landlords are
encouraged to expand their portfolios and invest in new build housing."

Unfortunately, simplification doesn't mean 'more generous'.  If government really wants to lever in more investment at little expense to the public purse then they need to give us a more favourable tax regime where residential landllords are treated on a par with business and residential investment is not seen merely as an investment.  I've talked before about the tax changes needed to encourage more investment from landlords.

For those with the time to read the full report you can download it here.

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