Holiday let tax changes to go ahead in Wales

The Welsh government has confirmed it will go ahead with changes to council tax that will make it harder for holiday lets to be exempt.

From next April they will need to be rented for 182 days in a year before they are allowed to pay business rates instead.

It comes as second home owners face a 300% council tax premium.

The Welsh Conservatives said the move was a "devastating blow to self-catering accommodation providers".

But ministers say the move will ensure property owners make a fair contribution to local communities.

Some holiday-let business have said they could become unviable.

Currently properties made available for let for at least 140 days, and actually let for 70, can be classed as paying business rates rather than council tax.

Under the plans from 1 April next year the threshold will rise, so properties will need to be made available for at least 252 days, and actually let for 182.

The move comes after a technical consultation on the plans, where 215 of 424 respondents told the Welsh government they were against the proposals, 36 were generally against them, and 31 responses raised concerns about the impacts on businesses.

However Finance Minister Rebecca Evans said the exercise "did not raise any issues of technical clarity that are considered to require amendment" of the proposals.

Responses to an earlier consultation "clearly support a change to the criteria for self-catering accommodation to be classified as non-domestic", said Ms Evans.

"The purpose of the change is to help ensure property owners are making a fair contribution to local communities, for example by increasing their contribution to the local economy through greater letting activity or by paying council tax on their properties."

Peter and Julia Hindley have run a holiday let business with six cottages and a B&B at their home in Llangattock, near Crickhowell, Powys, for 10 years.

Mr Hindley said the changes mean self-catering accommodation in Wales would become "an investors-only club".

"All the operating profits will evaporate as those who remain fight to achieve a booking level that less than 1% of respondents supported," he said.

"Apart from the hottest tourism hotspots only investors seeking capital gain will be able to afford to remain."

Conservative spokesman for culture, tourism and sport, Tom Giffard, said: "This is a devastating blow to self-catering accommodation providers across the length and breadth of Wales.

"These new letting requirements will frankly be impossible for many self-caterers to meet and will decimate the Welsh tourism industry.

"Labour ministers should be focused on helping the sector bounce back from Covid, not wreck the fragile recovery and put jobs at risk".