New tax could hit land in Wales

Architect, Doug Hughes, says the proposed Vacant Land Tax could affect hundreds of individuals, landowners and property developers in Mid Wales.

The government is currently discussing the tax and has not set out a date to introduce it through the 2014 Wales Act in the UK Parliament.

A similar tax in the Republic of Ireland, currently set at three per cent, rising to seven per cent in January 2019 has to be paid annually each year the land is left un-developed.

Mr Hughes, managing director of building design and planning consultancy, Hughes Architects which has offices in Welshpool and Newtown said the proposed tax could cover land identified for development in the Powys County Council Local Development Plan.

He says the plans come at the same time the Welsh Government is consulting on new planning powers in Wales, the Draft Planning Policy Wales, which also sets out changes to the way local authorities and the government deals with planning.

“These are two distinct policies that will affect not just businesses and developers in Wales, but private individuals too,” he said.

“Under the Vacant Land Tax, the Welsh Government want to introduce the levy on any land that has planning permission but has not been developed, or where it has been identified in a Local Development Plan for housing, employment or retail use amongst others.

“The idea is to use the tax to bring forward residential and commercial developments and to prevent land banking. While understandable, the tax will affect everyone from a private individual with a plot of land for a home through to a developer with plans to build a large housing estate."

Mr Hughes said anyone with a vacant plot of land with planning permission should seriously consider bringing it forward for development if the tax comes into force.

“While the specifics are yet to be set out, it would be wise for anyone with such land to consider moving forward with the development. Whether it’s a small dwelling, agricultural buildings or larger developments, it makes sense to seriously consider moving forward or face the tax burden around the corner which could also affect the viability of a development project.”

Details of the planned Vacant Land Tax can be found at wales.gov. The Draft Planning Policy Wales consultation, which ends on May 18, can also be found at the website.