WEIR RAISES CONCERNS OVER NEW RULES ON LOCAL BUSINESS

For Immediate Release – Friday 22 October 2010

Attn:    NEWS DESKS
         POLITICAL CORRESPONDENTS

SNP Business and Enterprise spokesperson Mike Weir MP has submitted a
response to the UK Government consultation on changes to the rules for
Furnished Home Letting tax relief pointing out that the new rules
could have serious consequences for some businesses, especially in
rural and remote areas of Scotland.

At present those who let out self-catering cottages and flats can
claim tax relief on some expenses but the rules are to be amended and
will introduce a minimum number of days that the properties require to
be let but Mr Weir has raised concerns that the level may have been
set too high.

Mr Weir undertook a survey of businesses in his own constituency of
Angus who may be affected by the changes and said the responses showed
that there was concern about the impact.

Mr Weir said:

“Whilst I recognise that the new Government have taken on board some
of the concerns of the industry it is vital that the minimum let
period is set at a level that businesses in more rural and remote
areas can meet.

“My own survey revealed that 34% of owners in Angus do not presently
meet the suggested threshold of 105 days, which far exceeds the
percentage quoted by organisations such as the Tourism Alliance and
other bodies in England. This does suggest that the impact of the
changes would be disproportionate and hit areas such as Angus worse
than those in the south.

“It is almost certain that the impact may be even greater in some
Highland and Island areas where the season can be shorter.

“I cannot believe that it would be the intention of the UK government
to remove this valuable relief from such a significant proportion of
the accommodation providers in rural areas of Scotland and thereby to
cause considerable damage to the local visitor economy virtually
overnight.

“As many of the businesses already run weekly lets it is unlikely to
be able to introduce them as an innovation to make up the numbers.

“I would urge the Treasury to look at mitigating the effects by a
gradual introduction of the threshold to allow businesses to adapt and
also to consider whether it might be possible to have a lower level in
more rural areas, a precedent that has been set by looking at lower
fuel duty in island areas.

“Self catering businesses remain an important part of the local
economy and bring in many visitors. I acknowledge that the proposals
now being put forward are an improvement on the position of the
previous government but it is vital that the Treasury take note of the
particular problems of rural areas and do not simply adopt a “one size
fits all “ policy.”

ENDS