CIL Watch: First Homes consultation proposes levy changes

Ministers have suggested that Community Infrastructure Levy (CIL) regulations will be changed to create an exemption for a proposed new type of discounted housing for first-time buyers and to avoid other forms of affordable homes from losing out.

New homes: Details on latest discounted homes policy revealed last week
New homes: Details on latest discounted homes policy revealed last week

The government launched a consultation last week on its plans to require developers to provide ‘First Homes’ - a class of affordable housing that will be offered to first-time buyers at a discount of at least 30 per cent compared to market rates.

According to the consultation paper, the government is "minded to amend secondary legislation to exempt First Homes from the Community Infrastructure Levy".

Local authorities currently have discretion to offer CIL relief on homes sold at discounted rates. The government said it believed a national exemption from CIL would "ensure consistency with other affordable tenures and provide the certainty needed to support delivery".

Proposed amendments to CIL regulations would specify that First Homes will be exempt from paying the levy, the government said.

Further changes to CIL regulations could include a requirement that levy rates are not set at levels that would "prevent current levels of affordable housing" being secured through section 106 agreements, according to the consultation paper.

According to the document, if local authorities are "given the option to set a policy requirement that a proportion of section 106 homes are delivered as First Homes", it may affect their "decision-making on the relative balance between [CIL] and section 106". For example, authorities "may choose to levy more [CIL] for infrastructure at the cost of affordable housing and First Homes".

Views are invited on whether plans to offer a CIL exemption will increase the delivery of First Homes and whether steps should be taken to ensure affordable housing continues to be delivered through section 106 obligations.

The consultation runs until 3 April.

CIL UPDATES

ADOPTION NEWS

Kent: Canterbury City Council has approved a CIL charging schedule that will come into effect from 1 April 2020.

Sussex: Arun District Council has approved a CIL charging schedule that will come into effect from 1 April 2020.

CONSULTATION NEWS

Oxfordshire: West Oxfordshire District Council is holding a six-week public consultation on its draft CIL charging schedule from 12 February.


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