Iain Duncan Smith, the former government work and pensions secretary, has urged a rethink of the government’s attitude on buy-to-let landlords. He feels that they are being punished by high stamp duty on house purchases and the reduction on tax relief for commercial mortgage interest payments.
Duncan Smith made his views known on the Conservative Home website in July 2017. He is concerned that many landlords are selling their properties or not purchasing new properties to expand their property portfolios. New housebuilding is not filling the demand for privately rented accommodation. He said:
“It is time for us to reconsider the way we treat private landlords who buy houses to rent. It is time to review Osborne’s tax changes on buy-to-let landlords.”
He added that private landlords remain a major provider of houses and should be assisted rather than discouraged through higher costs. He proposed that there should be VAT relief on converting property to rental units, and capital allowances made available for landlords.
The former leader of the Conservative Party stressed that many landlords were not rich property owners with large portfolios, but small landlords who are trying to create an income for their retirement and who also planned to leave their property to their children.
He added that even if the government achieves its new house building targets, this in itself will not be enough to meet the housing demand without the expansion of the private rented housing sector.