An MP has spoken out in favour of buy-to-let landlords by insisting that they should never have been denied a tax break on their property profits after the Chancellor George Osborne excluded them from a significant capital gains tax (CGT) cut in his Budget statement.
Landlords continue to be stung with a hefty 28% CGT bill when they sell up, a rate that the Chancellor himself described as one of the ‘highest in the developed world’.
Residential property was deliberately excluded from the tax cut that sees investors in other types of asset benefit from the higher rate of capital gains tax reduced from 28% to 20%, while the basic rate was reduced from 18% to 10%.
Kevin Hollinrake, the Conservative MP and co-founder of Hunters estate agents, is tabling an amendment to Clause 72 of the Finance Bill that would extend the new 20% CGT rate to private landlords when they sell their rented property to a sitting tenant.
The motion to put the measure into an amendment to the Finance Bill, which is currently going through parliament, was originally put forward by the Residential Landlords’ Association (RLA) which believes that a growing number of landlords are now thinking about exiting the market as renting becomes financially unsustainable for them.
Recent research from the RLA found that that 77% of private landlords would consider selling their property to tenants if the tax liability was reduced.
The RLA will be asking members to write to their MP encouraging them to back the proposed to the Bill.