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Labour calls on government to reverse £1.3bn ‘bung’ to second home buyers and landlords

LABOUR called on the government today to reverse an estimated £1.3 billion “bung” to second-home-owners and landlords. 

The party accused the Treasury of trying to sneak the announcement through after Chancellor Rishi Sunak’s summer economic update on Wednesday.

The update was blasted by Labour and trade unions for its poor targeting of financial support, leaving out many businesses and millions of people who are struggling financially during the coronavirus pandemic.

Mr Sunak announced that most homebuyers in England will not pay stamp duty on the first £500,000 of purchases between July 15 and March 31.

But the Treasury later said that the reprieve would also apply to purchases of second homes — barring the additional higher rate which starts at 3 per cent.

In 2019-20, 34 per cent of homes purchased were second properties, meaning that the new discount for second-home-owners could cost the taxpayer £1.3bn.

In a letter to Tory counterpart Robert Jenrick, shadow housing secretary Thangam Debbonaire argued that the money could fund the gap in local councils’ finances, which the Local Government Association predicts will be £1.2bn by the end of the year. 

“It is unacceptable that the Chancellor tried to sneak out this huge bung to second-home-owners and landlords while millions of people are desperate for support,” she said.

“He should be targeting support to those who need it, not helping people invest in buy-to-let properties and holiday homes.

“An unnecessary subsidy for second-home-owners will only worsen the housing crisis by reducing the supply of homes overall.

“We need a credible plan from Tory ministers to build the homes our country needs and get people on to the housing ladder. We didn’t see that this week.”

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