Government urged to scrap 'tenant's tax' hidden in licensing schemes

Councils that charge landlords for licences solely to collect information on the number of landlords in an area have been accused of creating a “tenant’s tax” because the licence cost is inevitably indirectly passed on to the renter to pay. 

The Residential Landlords Association says that a letter recently sent to all councils in England from the Department for Communities and Local Government has made it clear that they already have the power to ask tenants for information about a property’s tenure and landlord identity. This enables every local authority to build a register of landlords.

The RLA claims this exposes the “expensive folly” of licensing schemes which in some cases ask landlords to register and charge them a fee for doing so. These serve only to increase rents as landlords pass the costs on to tenants. 

The RLA has long campaigned for tenants to be asked to identify their landlord on council tax registration forms as a more effective way of finding all landlords, including criminal landlords who would never come forward to be licenced.

“The RLA is calling on councils to now drop the tenants’ tax that licensing has become. They should use the powers they already have to identify all landlords and go after the criminals” says RLA chairman Alan Ward. 

“Councils have always had the power to identify all landlords. This letter is a reminder from the government that they should use it instead of creating bureaucratic licensing schemes which tenants ultimately have to pay for. Asking tenants to identify their landlords is far more effective in finding and rooting out the criminal landlords who never willingly make themselves known” says Ward.