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Council tax set to rise for second properties

Owners of second homes face a rise in council tax payments if the Government allows local authorities to scrap the discount system that they currently offer.

Deputy Prime Minister John Prescott has given the go-ahead to remove the 50 per cent discount offered to owners of second homes. The move could raise £200m for local authorities.

But the Council of Mortgage Lenders criticises the move, describing it as another example of the Government treating homeowners as a source of income.

The proposal, included in a draft local government bill published last week, would take effect in two years.

It will hit 500,000 people but the Association of Rental Letting Agents says it will not have an impact on the buy-to-let market.

CML spokesman Bernard Clarke says: “This will have a very modest impact on the housing market but is a further unwelcome example of the Government deriving income from homeowners.”

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