Plan to cut tax relief on buy-to-lets rejected

Politicians have rejected plans to remove tax relief on buy-to-let mortgages.

Deputy Catherine Curtis, who lodged the proposal, said if interest relief was removed from buy-to-let mortgages there would be an increase in revenue from income tax of around £2m.

Deputy Barbara Ward said the proposed removal of tax relief might have been "the last straw" for small landlords and "push them into negative equity or even withdraw from the open market".

In the States Assembly on Friday 18 politicians voted for the proposal, 21 voted against and three abstained.

During the debate Ward said the proposed removal of tax relief would impact the local economy since "less property means less rent which means less tax".

Deputy Montfort Tadier said the subsidy was costing taxpayers.

He said: "By giving tax relief to private landlords, it's tax that we're forgoing at a time when government is saying we need to have money to spend on public services."

Curtis said it was "plain wrong" landlords received mortgage interest tax relief when owners with just one property did not.

"Housing has become too expensive and therefore we should not be encouraging it as an investment above the needs of homeowners," she added.

If interest relief was removed from buy-to-let mortgages, there would be an increase in revenue from income tax of around £2m, she added.

In December politicians narrowly voted against plans to abolish mortgage interest relief for landlords and reintroduce it for homeowners.

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