Government tax changes that could decimate Yorkshire tourism: Sign our petition

The true scale of the damage is a staggering 10 times above treasury predictions and will wreak havoc in one of our most important economies.

The proposals, which the government plans to introduce in April, will scrap tax privileges for holiday home owners but will also affect self-catering accommodation owners of which there are 2,500 in Yorkshire alone.

Now today the Yorkshire Post is launching a campaign alongside senior politicians and regional tourist chiefs calling for a review of the decision.

Sign our petition

Robert Goodwill, Conservative MP for Scarborough and Whitby, who has collected thousands of names on a petition against the changes, said: "The government is way off the mark.

"They have not fully accepted the unintended consequences of this on the tourism industry and small businesses in Yorkshire.

"This could cut off the lifeblood of the region.

"In many cases these tax changes will be the difference between a viable business and one which will have to be sold.

"It has been a dreadful shock for people to find out."

It is claimed the government had predicted its changes to the furnished holiday lettings rules would cost the industry 20 million nationwide.

But the research, undertaken by the Tourism Alliance, says the proposals could create an overall reduction in tourism spend of 200m in Britain and a loss of nearly 4,500 jobs in rural and seaside economies.

Self-catering accommodation in Yorkshire would be particularly hard hit with nearly 500 jobs put at risk.

Stephen Alambritis, chief spokesman of the Federation of Small Businesses, "This has left thousands of firms fearful of their future and Yorkshire will be a huge chunk of that.

"Out of all the regions we have looked at, Yorkshire is going to be the hardest hit.

"We know there are more independent family businesses in the trade than anywhere else in the whole of the country.

"These are family businesses built up over many years but if this goes through some of them won't be able to stay that way."

The repeal of the furnished holiday lettings rules was announced in the 2009 Budget but will come into effect in April this year.

It follows an EU ruling that British holiday home owners abroad should be entitled to the same tax breaks that they enjoy in the UK.

Self catering accommodation owners are treated under the same tax bracket as holiday home owners, and despite often relying on their businesses for their livelihoods, the decision means they will also have their tax benefits removed.

Ken Robinson, chair of Tourism Alliance, said: "The government is trying to claw as much tax in as they can from all sources but we are much more concerned about the impact this will have.

"At the moment the government is being very awkward and difficult but these are people's futures at stake.

"This is a big worry for us."

The estimated value of tourism to the region is almost 6.5billion, while last year Yorkshire was the fastest growing area in the UK for attracting visitors.

Gary Verity, chief executive of the official tourism agency Welcome to Yorkshire, said: "We are greatly concerned that the very people who are working hard to boost the regional economy are going to be penalised because of the proposed changes to the taxation of furnished holiday lets.

"We are working with organisations such as the Tourism Alliance, the Tourism Society and the Federation of Small Businesses and we're actively lobbying to persuade the Government to rethink this matter.

"We hope to convince them to agree to a review as we have serious concerns about the impact this will have on tourism businesses in Yorkshire."

Sign our petition

What the changes mean

Furnished Holidays Lettings were designed as special tax privileges to encourage landlords to provide holiday homes, and have been in force since the 1980s.

If the Furnished Holiday Lettings are repealed, self-catering businesses will change from being treated as a "trading business", the same as any other business including hotels and B&Bs, to being deemed as a residential landlord.

This change means they will lose their tax allowances, called capital allowances, which reduce the cost of setting up a business by 40 per cent as it allows you to deduct costs on business purchases from your profits on your annual tax bill.

They will also lose their capital expenditure relief, which currently allows self-catering businesses to save money by deducting the cost of replacing fixtures and fittings from their overall taxable income.

This will be replaced by a "10 per cent wear and tear allowance" which the treasury gives to all landlords.

The changes will also reduce the tax relief available when the property is sold.