As part of its financial reform initiatives, the government has called to end tax breaks on second homes.Currently, wealthy citizens can discount up to half of their council tax bill. This new policy will help councils raise hundreds of pounds more each year from council taxes.

Local councils will have the final discretion as to whether or not wealthy citizens will have to pay additional taxes on their second homes. However, since most politicians from every major party have been lobbying for these changes for a long time, it is unlikely many of them are going to allow these citizens to continue collecting the discount on their second homes.

Political Positions on the Bill

However, it may take some work getting the bill through. Even though many members of the conservative party agree with most of its premises, they are likely to argue a few elements of the bill. Namely, they feel that many of the people who are going to get hammered by it are members of the middle class who have worked hard to save for a second home.

The truth is, not only the privileged own more than one home. In fact, over the past 20 years, many middle class families have been trying to diversify their financial portfolios by purchasing real estate. After watching their home values plummet, paying extra taxes may just add insult to the injury.

The liberal parties may acknowledge these facts, but do not agree with the argument. They will most likely contend that the tax breaks on second homes have forced many people out of the housing market altogether.

Politicians are struggling to find ways to increase tax revenues. As the prices for homes have dropped in every region except London, they aren’t going to try to squeeze any more tax revenue out of citizens who are already struggling to get by. Instead, they are going to go after those who own houses that are sitting unoccupied.

A number of prominent politicians are moving to support the bill. Most notably is Prime Minister Cameron himself. Many people were disappointed with the prime minister’s attitude towards citizens in the lower tiers of society since he took office in 2010.

Guardian reporters interviewed one of their sources near Parliament. This source stated that wealthy citizens owning two homes was terrible for the middle class for several reasons. Essentially, the middle class is already struggling to pay their own taxes, while being forced to subsidize the elite who own two homes. The councils inability to collect taxes from second home owners has already cost them nearly 100 million pounds since the month before Cameron took office. Prime Minister Cameron was willing to acknowledge that citizens owning multiple homes was not good for the nation’s economy and wants to rectify that.

The new changes may help councils overcome some of the debt problems they are currently facing without having to target the lower and middle class. However, there is still the possibility that those groups will be hurt as well. Only time will tell how these decisions will affect them.