An influential new committee of experts is warning Chancellor Rachel Reeves not to make landlords pay National Insurance.
Instead the Independent Housing Policy and Delivery Oversight Committee – chaired by former cabinet minister and Liberal Democrat MP Sir Vince Cable – wants a more fundamental rethink of all aspects property taxation.
The committee was formed earlier this year to monitor and help government resolve the housing crisis.
At its recent first meeting it identified key problems with the housing sector but also gave a warning to Reeves.
“The case for major reform of the whole property tax system – from Stamp Duty Land Tax to Inheritance Tax to Council Tax and VAT – is almost unarguable” says Cable in a statement on behalf of the committee.
“Recent speculation about piecemeal changes in the Budget for revenue raising purposes, if they came about, would be a step in the wrong direction.
“To take just one example, putting National Insurance tax on landlords would be most likely to lead to higher rents for tenants. That is, in effect, an increase in taxation on working people.
“The reality is that wholesale reform is needed to make the market work more efficiently and achieve improvements in housing provision across the country. This is no small task and we do not underestimate its complexity or the political dimension.
“Change on the scale necessary demands the most careful consideration and at the least, a White Paper and extensive consultation to avoid unintended consequences to this fundamental aspect of society.”
The committee also identified key areas to be investigated – chiefly affordability and access to homeownership, the impact of the Renters Rights Bill, planning reforms, the availability of suitable housing for older people, the rising costs of construction, the decline in SME housebuilders, and the role of local and central government in delivery.
The committee will meet quarterly and consists of Sir Vince Cable as chair; Mark Bogard, chief executive of the Family Building Society; former Conservative MP Damian Green; current Labour MP Luke Murphy; Neil Jefferson, chief executive of the Home Builders Federation; economist Vicky Pryce; Ingrid Schroder of the Architectural Association; Maya Singer Hobbs of the Institute for Public Policy Research; and Professor Tony Travers of the London School of Economics.
