What assessment has the Minister made of the impact of the Non-Domestic Rating (Amendment of Definition of Domestic Property) (Wales) Order 2022 on genuine holiday accommodation businesses in counties which historically see less visitors than leading destinations?
The Welsh Government is of the view that for a property to be treated as a business for local taxation purposes, it should operate as a business for the majority of the year. We recognise this will have differing impacts in different localities. The proposed changes are intended, in part, to incentivise the greater use of such properties for business purposes and, where used to a lesser extent, these properties shall be liable for council tax.
We have considered the views put forward in our recent consultation Local taxes for second homes and self-catering accommodation. The consultation received almost 1,000 responses from across Wales. The views conveyed, including those from respondents representing the wider tourism industry, clearly support a change to the criteria for self-catering accommodation to be classified as non-domestic. Respondents were of the view that the majority of genuine holiday accommodation businesses would be able to satisfy increased letting thresholds, and a range of possible alternatives was suggested.
A regulatory impact assessment on the draft regulations is being compiled and will make use of all available information. We do not currently hold detailed data on the levels at which self-catering properties are occupied. Data on the definition of self-catering properties is collected and held by the Valuation Office Agency as part of its independent role in maintaining the tax-base for non-domestic rates and council tax. While the VOA obtains information from individual ratepayers for the purpose of accurately classifying self-catering properties, data are not currently available to analyse for wider purposes.
This work is being carried out in collaboration with Siân Gwenllian, the Plaid Cymru designated lead member, as part of the Co-operation Agreement between the Welsh Government and Plaid Cymru.