Pembrokeshire County Council has made the decision to reduce the council tax premiums on second homes from 200% to 150% in the next financial year. This move, however, has raised concerns as it could potentially lead to a significant 14% rise in council tax for residents. During a recent meeting, council members were presented with two proposals to decrease the council tax premium for second homes, with estimates suggesting that this change could result in a cost of £2.6m to £5.2m for the council. This, in turn, may cause an overall council tax increase of up to 18.8% in the coming year.
Currently, Pembrokeshire is already facing an 11.14% projected increase in council tax for the upcoming financial year. Owners of second homes have been subject to a 200% premium on their council tax since the previous year, effectively paying triple the standard rate. The local authorities have the power, under Welsh Government legislation, to raise the council premium on second homes to as high as 300%, effectively quadrupling the rate. Additionally, long-term vacant properties in the county face premium council tax rates that increase over time, with rates of 100% after 24 months, 200% after 36 months, and 300% after five years.
At the recent council meeting, members were advised to maintain the current 200% premium for second homes and keep the long-term empty property rates unchanged. There was also a request to the Welsh Government to reduce the 182-day criteria for holiday lets rate relief. Alternative proposals were put forth during the meeting, including a 100% premium suggested by the Conservative group leader and a 150% premium suggested by the Independent Group leader.
Despite arguments for a lower second homes premium rate, concerns were raised about the potential financial impact on the council. The debate highlighted the balancing act between generating revenue from second-home owners and ensuring fairness for all residents. After deliberation, an amended proposal reducing the premium to 150% was supported, leading to further discussions on related matters to be addressed in subsequent meetings.