A better alternative to S24?

Mark I couldn't agree more it's time to get ur own ship in order as best you can and batten down the hatches it's is a great idea but let's be brutally honest it's clutching at straws. The only time this will be repealed is when the carnage starts happening in about 2/3 years time I really believe all efforts should be channelled into limiting the affects on ur own portfolios sad but true the government arnt listening.

I think it will be interesting to see the reactions of others to this - not those of us who are hit by s24 but those who are currently not. I expect they'll be up in arms about the idea of having to pay a 2% levy, and yet they are unconcerned that their fellow landlords are facing potentially infinite rates on losses. People don't see or understand the injustice of things until it applies to them. I'm with Jamie on this - seeing it as the lesser of two evils. Of course it's completely discriminatory and unjust but s24 is even more so. It is a lot better than the recent 'alternative' suggested by the RLA which consisted of talking about how to spend the proceeds stolen from current landlords by the Treasury on incoming landlords - a kind of 'spending the spoils of war' idea. At least this is an idea about how to mitigate and ameliorate a pernicious measure. It does carry risks of course, but just because we might all keep quiet and only whisper about rent caps, for example, that doesn't mean they won't be the next thing to be announced. Indeed, going slightly off topic, I am sending out my second batch of rent increase letters on tenants in situ this month, just in case the March Budget does include rent caps.

It would be more transparent if it were run like Insurance Premium Tax and added visibly to rents. Tenents would then know who to blame for their increase, rather than assuming it's greedy landlords.

agree with Mark.

a nice idea, but could also cause problems for the Government. A 2% tax on rent sounds an awful lot like a tax on tenants, whereas the mortgage interest relief thing is a clear attack on landlords. Easier for the Government 'to be seen to be' taxing landlords rather than tenants....even if both landlords and tenants will suffer either way.

Reply to the comment left by "Jerry Jones" at "01/02/2017 - 09:15":

Which is probably one of the main reasons that it won't be adopted.

I never agreed with why savers should be penalised when Investment Income was singled out and taxed at an additional tax rate of 15% until 1985 on top of income tax rates aka Investment Income Surcharge. Therefore I fail to accept why Investment "Rental" Income should be singled out. As already pointed out on a different thread, Landlords have already been hit hard & in some cases singled out in a very short space of time with:-
Housing benefit reduced to 30th Percentile
Housing benefit capped
Housing benefit frozen
Direct payment to tenants compulsory, unless eviction threat
New PRA tight mortgage lender rental calculations = mortgage prisoners
New BTL lending controls making it impossible for HB tenants
Compulsory HMO Licensing
Uncontrolled Selective Licensing
Loss of Wear & Tear Allowance
Stamp Duty Surcharge for Landlords
Extra Capital Gain Tax For Landlords
Rent Repayment Orders
Right to Rent Prosecutions
Section 21's delays for new tenancies
5 months to legally evict even criminal tenants and liars
Court fees increased
Fines and penalties for any errors with deposits
Legionnaires disease risk assessments .
Abolition of agents referencing fees (tbc)
Section 24 - now recommended be replaced (but would no doubt be on top) with this 2% idea.
The example given is based on gross rental income and not taxable net rental income which would therefore be equivalent to nearer a 4% tax or for some, a lot more.
It's then mooted that Landlords could easily increase rents by 2% to cover this levy/surcharge, yet this would have to be on top of the increases Landlords need to put in place already to cover the extra costs of the list above. This would therefore require rent increases of nearer 4% or more JUST TO STAND STILL. In fact, increases would need to be greater than this otherwise we'd be going BACKWARDS after allowing for inflation eroding every pound collected and although inflation is currently low at 1.6%, this small percentage still needs to be accounted for in one's maths of running a business, especially if inflation rises further (which it will - one day). What sort of business is that?

Maybe I've missed the point here, but if the maths work out for a 2% tax on just the landlord sector, then surely just a 1% income tax increase for the WHOLE of the working population (not just landlords) would provide much more of a boost to the country's coffers. I'd be happy to pay that if it were to help out with our NHS, or teachers, or police etc. Much fairer for everyone to chip in and help our ailing services.

Reply to the comment left by "Gareth Wilson" at "31/01/2017 - 10:34":

I could not agree more Gareth Wilson's comment. Well said.

Reply to the comment left by "Rhett Costin" at "01/02/2017 - 10:36":

Well said that man, I'd be happier with that too!
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Reply to the comment left by "Dr Rosalind Beck" at "01/02/2017 - 09:14":

Please don't assume that all those landlords not affected by S.24 are unconcerned about it's injustice, we certainly are not. I, for one, am incensed by it; it's clearly wrong and against all established taxation and business practice, though obviously I wouldn't exactly welcome any additional tax. This proposed tax would be a great revenue raiser for the government, but one of the aims of S.24 is apparently to reduce and discourage personal debt. The proposed tax would not achieve this aim, neither would it pave the way for corporate Build to Let by forcing many private landlords out of the market. By raising this suggestion are we not in danger of ending up with both measures and possibly rent caps as well?