IT is with great warmth and pleasure I welcome landlords challenging the legality of George Osborne’s summer tax grab through the courts.
Now with £50k of funds raised in a matter of days, Chris Cooper and Steve Bolton can lodge a pre-action protocol letter with an application for a judicial review. You can read more about what they are fighting for here: https://www.crowdjustice.co.uk/case/clause24/.
This news is bolstered by Lord Flight also posting on the Conservatives own website that he thinks the tax grab is fundamentally flawed as well. So good old George is getting it from without and within and I sincerely hope he wakes up to his own ignorance. Especially when you learn that the policy was proposed by a newly graduated Geography major who has patently little grasp of housing or even economics.
But despite the raw and very plain wrongness of the clause 24 action that means landlords cannot claim mortgage interest as a cost. Despite the outcry from landlords, professional bodies and even members of the Conservative party. Despite the ludicrous way the policy was created, the ignorance of how it will damage the housing market and even the harm it will do to the Conservatives chances at winning the next election. Despite all of that, I think the judicial review will fail.
It won’t fail because it is wrong though. It will fail because the Government can use our tax money to defend itself with the best lawyers money can find. They effectively own the system and because they can vote in legislation, they can rewrite or amend the rulebook when they like. It’s a one-sided affair.
And in this case ignorance really will work against everyone. Osborne’s pig headed ignorance of the drop in house building, rise in demand for council housing as tenants are evicted, the rise in rents that will inevitably snowball as landlords look to cover costs and the misery of more homeless and even possibly a short house price crash will all lead to these things happening.
More so now that he already has a bloody nose on being defeated over tax credits – he will not want anything else from his summer budget overturned now. He is determined and sheer bloodymindedness combined with unlimited legal resource will see it come into law and housing misery for millions.
Yes, a price reduction in London may benefit some younger aspirational buyers – but less housebuilding will soon outweigh that and demand outstripping supply wqill see them go up again. And what about the tens of millions of homeowners who are about to see the value of their homes drop and possibly go into negative equity. They aren’t going to love you George.
It’s a deeply flawed policy and I applaud the judicial review, it is worth contributing to if you are a landlord or tenant as the PR it gets will hopefully wake the country up to what’s happening and ensure the finger of blame lies with Osborne once it is carried through. And there is an outside chance it could defeat him as well, which is great.