Generation Rent accuses landlords of having their rental income bolstered by £26.7bn in taxpayers’ money
Generation Rent has claimed that landlords are benefitting from subsidies worth the equivalent of £1,000 for each household in the UK.
The campaign group has accused landlords of having their rental incomes bolstered by tax breaks and housing benefits by as much as £26.7bn a year- that’s £1,011 each for England’s 26.4m households.
The group’s figure is made up of £9.3bn of housing benefit paid on behalf of low-income tenants, £1.69bn through the “wear-and-tear” tax relief landlords can claim on their properties, £6.63bn of tax that landlords do not have to pay on mortgage interest payments and £9.06bn of tax landlords do not pay on their annual average capital gains.
Generation Rent calculated that landlords, who house 4.75m households in the UK, are earning £77.7bn a year: £42.3bn in rent and £35.4bn in rising house prices. Through income tax on rent and capital gains tax on sold properties, it estimated they were handing £8.9bn to the taxman.
Generation Rent is calling for an additional landlord levy of 22% on rental income, to recoup the £9.3bn housing benefit bill and should be used to fund 90,000 new council houses.
Alex Hilton of Generation Rent said: “While renters have borne the brunt of austerity, landlords have enjoyed their own little economy the size of Morocco’s supported by subsidies from the UK taxpayer that could be better used fixing the housing crisis.”
Hilton said those who wanted to buy somewhere to live were at a disadvantage compared with buyers who could write off interest against tax. He added: “It’s time landlords started paying more of their fair share so first-time buyers could have a level playing field and the government could have the resources to build more social housing.”
Labour MP Frank Field has called for an immediate review of public spending on housing, to increase home building and reduce the UK’s housing benefit bill. He said: “Instead of building more homes, taxpayers’ money is used to push up housing asset prices”.
He went on to say: “A national housebuilding programme is not only desirable, it is essential. The bill footed by the taxpayer to top up the rent money is out of control, because landlords know they can charge what they like, while renters are left to wait patiently for years for a new home.”
Let us know your thoughts.
Generation rent has given our members much to talk about over the last year. Stay up to date with some of the discussions below.
GENERATION RENT STRIKES AGAIN – With a Manifesto that will not surprise landlords: here
Generation rent strikes back with new ‘TripAdvisor for tenants’ site – A TWIST ON TENANT REFERENCING!: here
Britain will become a nation of renters within the next generation: here