Budget 2015: Campaigners hit back as landlords hint at rent rises
Campaigners for rent controls have hit back at Scottish landlords who may be planning to raise rents in response to a reduction in the amount of tax relief for buy-to-let mortgages.
Yesterday’s Budget Statement included the announcement that tax relief on mortgage interest payments for buy-to-let landlords would be cut to 20 per cent over four years from April 2017.
Property investors can currently claim tax relief at the top level of tax they pay, meaning wealthier landlords can claim back as much as 45 per cent.
John Blackwood, chief executive of the Scottish Association of Landlords, claimed the decision to cut tax relief “unfairly discriminates against landlords”.
Mr Blackwood added: “Although we welcome other measures in the Budget such as reforms to the Rent A Room scheme which will increase supply of affordable rented accommodation, the decision on buy-to-let mortgages means landlords will essentially be taxed for investing in their businesses, something utterly unthinkable in any other sector.
“As a result of this increase cost and risk to landlords, you may see some within the sector feeling they are forced to increase their rent levels which would obviously have a huge negative impact on tenants.”
However, his comments were condemned as “threats” by the Living Rent Campaign, an organisation of tenants pressing for the introduction of rent controls in Scotland.
Jon Black from the Living Rent Campaign said: “This budget contained no good news for tenants whatsoever, and no good news for anyone struggling to make ends meet. But these threats from the Scottish Association of Landlords go one step further. Rents in Scotland are already out of control, and now tenants are being hit again.
“Landlords already receive billions in subsidies from the taxpayer, and to use this as an excuse to increase rents is appalling.
“The Scottish Government needs to follow the example of Berlin and introduce rent controls to prevent tenants from being forced further into poverty.”