A trade group has commissioned a firm of economists to look at how the government’s mortgage interest tax relief change - due in six weeks time - will hit the buy to let sector.
The National Landlords Association, in an update to the main campaign against the mortgage interest tax relief change, says it does not believe the government is ready to abandon the proposal - formally known as Section 24 of the Finance Act - without substantive research to demonstrate the dis-benefit of the change.
“We recently met with the Financial Secretary to the Treasury, Jane Ellison MP. Once again we stated our position regarding Section 24 and presented all our available research and survey evidence” says the NLA statement to the Axe The Tenant Tax campaign.
“Whilst she heard our arguments politely, and was keen to see our evidence of more tax payers pushed into the higher tax bracket, it is fair to say the government are not going to reverse the Osborne Legacy just yet” the NLA continues, referring to the fact that the mortgage interest change was created by former Chancellor George Osborne in 2015.
The statement goes on: “We recognise that to get the Treasury to change its mind will increasingly rely on undertaking research in order to demonstrate measurable changes and effects post-implementation 2017 onwards. We have commissioned a firm of economists to undertake research into the projected impact of Section 24 on the UK economy which is due to report soon, however this type of campaign is likely to take some time.”
The association adds that all the feedback from its landlord members has suggested that the mortgage interest change will lead to increased rents, some sales of buy to let properties that are no longer profitable, and increased incorporation by landlords keen to legally avoid the new tax burden.
However - as reported by Letting Agent Today here - the NLA says it is going to concentrate on lobbying government on other issues in the shorter term, ahead of the Budget in three weeks’ time.