19 Nov 2015

Call to scrap tax relief for landlords

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‘Green mayoral candidate Sian Berry has called for George Osborne to completely scrap mortgage interest tax relief for landlords, rather than simply restricting relief to the basic rate of income tax. She said the policy costs the Treasury £1.3bn a year, which would be better spent on affordable housing. Ms Berry said 16,000 extra affordable homes could be built in London over four years, helping to increase supply for essential but low paid workers.

Source: London Evening Standard’

We could not agree less. This is not at all difficult, Ms Berry. Letting property is a business. It’s a very necessary business and a perfectly legitimate one, unless of course you subscribe to the communist doctrine that outlaws private ownership of property (aside – Why do communists drink herbal tea? Because all proper tea is theft). As for any business, the cost of borrowing money to finance the business is a normal and proper cost of doing business. And there is no reason to deny tax relief for normal and proper costs of doing business.